Salience and consumer choice

Pedro Bordalo, Nicola Gennaioli and Andrei Shleifer

Economics Working Papers from Department of Economics and Business, Universitat Pompeu Fabra

Abstract: We present a theory of context-dependent choice in which a consumer's attention is drawn to salient attributes of goods, such as quality or price. An attribute is salient for a good when it stands out among the good's attributes, relative to that attribute's average level in the choice set (or generally, the evoked set). Consumers attach disproportionately high weight to salient attributes and their choices are tilted toward goods with higher quality/price ratios. The model accounts for a variety of disparate evidence, including decoy effects, context-dependent willingness to pay, and large shifts in demand in response to price shocks.

JEL-codes: D03 D81 (search for similar items in EconPapers)
Date: 2010-04, Revised 2012-05
New Economics Papers: this item is included in nep-cbe, nep-evo, nep-hpe and nep-upt
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (26)

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Related works:
Working Paper: Salience and Consumer Choice (2015)
Journal Article: Salience and Consumer Choice (2013)
Working Paper: Salience and Consumer Choice (2013)
Working Paper: Salience and Consumer Choice (2012)
Working Paper: Salience and Consumer Choice (2012)
Working Paper: Salience and Consumer Choice
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Persistent link: https://EconPapers.repec.org/RePEc:upf:upfgen:1252

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