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Stochastic Choice and Consideration Sets

Author

Listed:
  • Paola, Manzini
  • Marco, Mariotti
Abstract
We model a boundedly rational agent who suffers from limited attention. The agent considers each feasible alternative with a given (unobservable) probability, the attention parameter, and then chooses the alternative that maximises a preference relation within the set of considered alternatives. We show that this random choice rule is the only one for which the impact of removing an alternative on the choice probability of any other alternative is asymmetric and menu independent. Both the preference relation and the attention parameters are identi fied uniquely by stochastic choice data.

Suggested Citation

  • Paola, Manzini & Marco, Mariotti, 2013. "Stochastic Choice and Consideration Sets," SIRE Discussion Papers 2013-28, Scottish Institute for Research in Economics (SIRE).
    • Handle: RePEc:edn:sirdps:463
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    File URL: http://hdl.handle.net/10943/463
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    References listed on IDEAS

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    More about this item

    Keywords

    Discrete choice; Random utility; Logit model; Luce model; Consideration sets; bounded rationality; revealed preferences;
    All these keywords.

    JEL classification:

    • D0 - Microeconomics - - General

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