Eliminate the normative worst, then choose

Abhinash Borah and Raghvi Garg ()
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Raghvi Garg: Ashoka University

Economics Bulletin, 2021, vol. 41, issue 4, 2348-2355

Abstract: We model the behavior of a decision maker (DM) who is psychologically constrained from choosing according to her tastes by her normative preferences that capture her values and ideals. In any menu, choosing the worst alternative according to her normative preferences may produce overwhelming feelings of guilt. Hence, to mitigate such feelings, she eliminates this alternative and chooses the best amongst the remaining ones according to her tastes. We formally define this sequential choice procedure and behaviorally characterize it. We show that the parameters of the model—the DM's tastes and norms—can be (almost) uniquely identified from choices. We also highlight the model's implications for "non-standard" choices.

Keywords: behavioral choice theory; tastes and norms; guilt; elimination; sequential choice procedure; menu effects and behavioral choices (search for similar items in EconPapers)
JEL-codes: D1 (search for similar items in EconPapers)
Date: 2021-12-29
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