A model of rejection-based decision making

Bhavook Bhardwaj and Kriti Manocha

Journal of Economic Theory, 2025, vol. 228, issue C

Abstract: This paper introduces a model of decision making based on a procedure of rejection. Departing from the standard model of choice via preference maximization, the decision maker (DM) in our model rejects minimal alternatives from a menu according to a binary relation. We axiomatically study the correspondence of non-rejected alternatives with different rationality conditions on the underlying binary relation. We then generalize our model to study correspondences generated by an iterative procedure of rejection. It is observed that the classical rational choice model is a special case of this model, thus providing a procedural description of selecting the maximal set. We find that the rejection approach developed in this paper can also explain anomalies observed in decision theory, such as the two-decoy effect or the two-compromise effect.

Keywords: Maximization; Rejection; Iterative elimination; Bounded rationality (search for similar items in EconPapers)
JEL-codes: D0 D9 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jetheo:v:228:y:2025:i:c:s0022053125001061

DOI: 10.1016/j.jet.2025.106060

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