Trade-off aversion and indecisive behaviours

Edwin Ip and Stephen Nei

Journal of Economic Behavior & Organization, 2025, vol. 236, issue C

Abstract: Why do people suffer from choice overload but still prefer larger choice sets? We present a model of indecision where decision makers find making trade-offs psychologically painful. We show that aversion to making trade-offs leads to indecisive behaviours (choice avoidance and choice overload). However, not all trade-off averse decision makers succumb to indecisions. Decision makers who are aware of their trade-off aversion should anticipate indecisive behaviours and mitigate them accordingly by restricting their consideration set. Our results suggest that indecisive behaviours are not simply a problem of having indecisive preferences but also a problem of self-awareness.

Keywords: Choice avoidance; Choice overload; Trade-off aversion; Indecision; Self-awareness (search for similar items in EconPapers)
JEL-codes: D01 D11 D83 D90 D91 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:236:y:2025:i:c:s0167268125002148

DOI: 10.1016/j.jebo.2025.107095

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