A simple model of two-stage choice

Sean Horan

Cahiers de recherche from Universite de Montreal, Departement de sciences economiques

Abstract: I provide choice-theoretic foundations for a simple two-stage model, called transitive shortlist methods, where choices are made by sequentially by applying a pair of transitive preferences (or rationales) to eliminate inferior alternatives. Despite its simplicity, the model accommodates a wide range of choice phenomena including the status quo bias, framing, homophily, compromise, and limited willpower. I establish that the model can be succinctly characterized in terms of some well-documented context effects in choice. I also show that the underlying rationales are straightforward to determine from readily observable reversals in choice. Finally, I highlight the usefulness of these results in a variety of applications.

Keywords: Shortlisting; axiomatization; revealed preference; identification (search for similar items in EconPapers)
JEL-codes: D01 (search for similar items in EconPapers)
Pages: 40 pages
Date: 2016
New Economics Papers: this item is included in nep-gth, nep-mic and nep-upt
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (22)

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http://hdl.handle.net/1866/13024 (application/pdf)

Related works:
Journal Article: A simple model of two-stage choice (2016)
Working Paper: A Simple Model of Two-Stage Choice (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:mtl:montde:2016-01

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