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 . https://doi.org/10.3982/ECTA10575
Publication
Econometrica
Status
Peer reviewed
ISSN
0012-9682Type
Journal article
Rights
© 2014. Econometric Society. The copyright to this article is held by the Econometric Society, http://www.econometricsociety.org/. It may be downloaded, printed and reproduced only for personal or classroom use. Absolutely no downloading or copying may be done for, or on behalf of, any for-profit commercial firm or for other commercial purpose without the explicit permission of the Econometric Society. For this purpose, contact the Editorial Office of the Econometric Society at econometrica@econometricsociety.org.
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