Gradual Pairwise Comparison and Stochastic Choice

Rohan Dutta

Cahiers de recherche from Centre interuniversitaire de recherche en économie quantitative, CIREQ

Abstract: Guided by evidence from eye-tracking studies of choice, pairwise comparison is assumed to be the building block of the decision-making procedure. A decision-maker with a rational preference may nevertheless consider the constituent pairwise comparisons gradually. Facing a choice problem she may be unable to complete all relevant comparisons and choose with equal odds from alternatives not found inferior. Stochastic choice data consistent with such behaviour is characterized and used to infer the underlying preference relation and the order of pairwise comparisons. The choice procedure offers a novel rationale for behavioural phenomena such as the similarity, attraction and compromise effects.

Keywords: revealed preference; bounded rationality; stochastic choice (search for similar items in EconPapers)
Pages: 50 pages
Date: 2018
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Related works:
Journal Article: Gradual pairwise comparison and stochastic choice (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:mtl:montec:23-2018

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