Stochastic choice and consideration sets
Abstract
We model a boundedly rational agent who suffers from limited attention. The agent considers each feasible alternative with a given (unobservable) probability, the attention parameter, and then chooses the alternative that maximises a preference relation within the set of considered alternatives. We show that this random choice rule is the only one for which the impact of removing an alternative on the choice probability of any other alternative is asymmetric and menu independent. Both the preference relation and the attention parameters are identified uniquely by stochastic choice data.
Citation
Manzini , P & Mariotti , M 2014 , ' Stochastic choice and consideration sets ' Econometrica , vol. 89 , no. 3 , pp. 1153-1176 . DOI: 10.3982/ECTA10575
Publication
Econometrica
Status
Peer reviewed
ISSN
0012-9682Type
Journal article
Rights
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