Stochastic Choice and Consideration Sets

Paola Manzini and Marco Mariotti

No 1205, CEEL Working Papers from Cognitive and Experimental Economics Laboratory, Department of Economics, University of Trento, Italia

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. Both the preference and the attention parameters are identified uniquely by stochastic choice data. The model is the only one for which the impact of removing any alternative a on the choice probability of any other alternative b is non-negative, asymmetric (either a impacts b or vice-versa), menu independent, neutral (the same on any alternative in the menu), and consistent with the impacts on a and b by a common third alternative.

Keywords: Discrete choice; Random utility; Logit model; Consideration sets; bounded rationality; revealed preferences (search for similar items in EconPapers)
JEL-codes: D0 (search for similar items in EconPapers)
Date: 2012
New Economics Papers: this item is included in nep-mic and nep-upt
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Citations: View citations in EconPapers (2)

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Related works:
Journal Article: Stochastic Choice and Consideration Sets (2014)
Working Paper: Stochastic Choice and Consideration Sets (2013)
Working Paper: Stochastic Choice and Consideration Sets (2012)
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