Revealing Choice Bracketing

Andrew Ellis and David Freeman

Papers from arXiv.org

Abstract: Experiments suggest that people fail to take into account interdependencies between their choices -- they do not broadly bracket. Researchers often instead assume that people narrowly bracket, but existing designs do not test it. We design a novel experiment and revealed preference tests for how someone brackets their choices. In portfolio allocation under risk, social allocation, and induced-value shopping experiments, 40-43% of subjects are consistent with narrow bracketing and 0-16% with broad bracketing. Adjusting for each model's predictive precision, 74% of subjects are best described by narrow bracketing, 13% by broad bracketing, and 6% by intermediate cases.

Date: 2020-06, Revised 2024-03
New Economics Papers: this item is included in nep-dcm, nep-exp and nep-upt
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Citations: View citations in EconPapers (4)

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Related works:
Journal Article: Revealing Choice Bracketing (2024)
Working Paper: Revealing choice bracketing (2024)
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Persistent link: https://EconPapers.repec.org/RePEc:arx:papers:2006.14869

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