Odds supermodularity and the Luce rule

Serhat Doğan and Kemal Yildiz

Games and Economic Behavior, 2021, vol. 126, issue C, 443-452

Abstract: We present a characterization of the Luce rule in terms of positivity and a new choice axiom called odds supermodularity that strengthens the regularity axiom. This new characterization illuminates a connection that goes unnoticed, and sheds light on the behavioral underpinnings of the Luce rule and its extensions from a different perspective. We show that odds supermodularity per se characterizes a structured extension of the Luce rule that accommodates zero probability choices. We identify the random choice model characterized via a stochastic counterpart of Plott (1973)'s path independence axiom, which strengthens odds supermodularity.

Keywords: Random choice; Luce rule; Supermodularity; Zero probability choices; Stochastic path independence (search for similar items in EconPapers)
JEL-codes: D01 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:gamebe:v:126:y:2021:i:c:p:443-452

DOI: 10.1016/j.geb.2021.01.008

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