Context-dependent choice as explained by foraging theory

Shengwu Li and Ning Neil Yu

Journal of Economic Theory, 2018, vol. 175, issue C, 159-177

Abstract: An agent makes consumption choices in multiple periods. Choice objects vary in type and quality; objects of the same type are inter-temporal substitutes. The current choice set is informative about the distribution over future choice sets. Thus, the presence of unchosen alternatives may rationally alter the agent's choice. Under some simple assumptions, the optimal policy exhibits context-dependent choice behavior, such as the decoy effect and choice overload.

Keywords: Decoy effect; Choice overload; Foraging theory; Consumer choice; Dynamic stochastic choice model; Monotone comparative statics (search for similar items in EconPapers)
JEL-codes: D11 D83 D90 M31 (search for similar items in EconPapers)
Date: 2018
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:jetheo:v:175:y:2018:i:c:p:159-177

DOI: 10.1016/j.jet.2018.01.014

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