Learning while shopping: an experimental investigation into the effect of learning on consumer search

Ben Casner ()
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Ben Casner: The Ohio State University

Experimental Economics, 2021, vol. 24, issue 1, No 10, 238-273

Abstract: Abstract In many search environments, searchers are learning about the distribution of offers in the market. I conduct an experiment exploring a broad class of search problems with learning about the distribution of payoffs. My results support the prediction that learning results in declining reservation values, providing evidence that learning may be an explanation for recall. Theory predicts a “one step” reservation value strategy, but many subjects instead choose to set a high reservation value in order to learn about the distribution before adjusting based on their observations. Under-searching in search experiments may stem from a reinforcement heuristic and lack of negative feedback after using sub-optimal strategies.

Keywords: Search; Learning; Information heuristics; Search experiments; Unknown distribution; Reinforcement heuristic (search for similar items in EconPapers)
JEL-codes: D83 D9 L15 (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (7)

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DOI: 10.1007/s10683-020-09659-7

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