Anticipated stochastic choice

Koida, Nobuo

doi:10.1007/s00199-016-1025-9

Cited by 10 publications

(8 citation statements)

References 41 publications

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“…For instance, researchers have made payments to subjects as a function of judgments involving the relative quantity of dots (Caplin and Dean, 2015;Dutilh and Rieskamp, 2016), the dominant direction of moving dots (Bhui, 2019a;2019b), the number of ‡ickering dots (Oud et al, 2016), a dynamic display of dots (Zeigenfuse, Pleskac, and Liu, 2014), the heights of bars of dynamic size (Tsetsos et al, 2016), and the area occupied by objects of various sizes (Polanía, Krajbich, Grueschow, and Ru¤, 2014). 5 To our knowledge, Du¤y, Gussman, and Smith (2019) is the only other paper that describes a choice experiment where suboptimal choices are perfectly observable because utility Saito, and Tserenjigmid (2018), Koida (2018), Kovach and Tserenjigmid (2018), Caplin, Dean, and Leahy (2019), Cattaneo, Ma, Masatlioglu, and Suleymanov (2019), Conte and Hey (2019), and Natenzon (2019).…”

Section: Choice Involving Imperfectly Perceived Objectsmentioning

confidence: 99%

An Economist and a Psychologist Form a Line: What Can Imperfect Perception of Length Tell Us About Stochastic Choice?

Duffy¹,

Smith

2020

SSRN Journal

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Standard choice experiments are hampered by the fact that utility is either unknown or imperfectly measured by experimenters. As a consequence, the inferences available to researchers are limited. By contrast, we design a choice experiment where the objects are valued according to only a single attribute with a continuous measure and we can observe the true preferences of subjects. Subjects have an imperfect perception of the choice objects but can improve the precision of their perception with cognitive e¤ort. Subjects are given a choice set involving several lines of various lengths and are told to select one of them. They strive to select the longest line because they are paid an amount that increases with the length of their choice. Our design allows us to observe the search history, the response times, and make unambiguous conclusions about the optimality of choices. We …nd a negative relationship between the demanding nature of the choice problems and the likelihood that subjects select the optimal lines. We also …nd a positive relationship between the demanding nature of the choice problems and the response times. However, we …nd evidence that suboptimal choices are associated with longer response times than are optimal choices. This result appears to be consistent with Fudenberg, Strack, and Strzalecki (2018). Additionally, our experimental design permits a multinomial discrete choice analysis. Our results suggest that the errors in our data are better described as having a Gumbel distribution rather than a normal distribution. We also observe e¤ects consistent with memory decay and attention. Finally, we …nd evidence that choices in our experiment exhibit the independence from irrelevant alternatives (IIA) property.

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Section: Choice Involving Imperfectly Perceived Objectsmentioning

confidence: 99%

An Economist and a Psychologist Form a Line: What Can Imperfect Perception of Length Tell Us About Stochastic Choice?

Duffy¹,

Smith

2020

SSRN Journal

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“…Some of the recent choice literature has focused on consideration set e¤ects, whereby 3 A partial list of these e¤orts, not previously mentioned, would include Tversky (1969), Loomes, Starmer, and Sugden (1989), Sopher and Gigliotti (1993), Loomes and Sugden (1995), Sopher and Narramore (2000), Gul and Pesendorfer (2006), Rubinstein and Salant (2006), Tyson (2008), Caplin, Dean, and Martin (2011), Conte, Hey, and Mo¤att (2011), Wilcox (2011), Gul, Natenzon, and Pesendorfer (2014), Loomes and Pogrebna (2014), Woodford (2014), Caplin and Dean (2015), Caplin and Martin (2015), Cubitt, Navarro-Martinez, and Starmer (2015), Lu (2016), Apesteguia, Ballester, and Lu (2017), Dean and Neligh (2017), Ahumada and Ulku (2018), Apesteguia and Ballester (2018), Echenique, Saito, and Tserenjigmid (2018), Koida (2018), Kovach and Tserenjigmid (2018), Caplin, Dean, and Leahy (2019), Conte and Hey (2019), and Natenzon (2019).…”

Section: Related Literaturementioning

confidence: 99%

Judgments of Length in the Economics Laboratory: Are There Brains in Choice?

2019

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We design a choice experiment where the objects are valued according to only a single attribute with a continuous measure and we can observe the true preferences of subjects. However, subjects have an imperfect perception of their own preferences. Subjects are given a choice set involving several lines of various lengths and are told to select one of them. They strive to select the longest line because they are paid an amount that is increasing in the length of their selection. Subjects also make their choices while they are required to remember either a 6-digit number (high cognitive load) or a 1-digit number (low cognitive load). We …nd that subjects in the high load treatment make inferior line selections and perform worse searches. When we restrict attention to the set of viewed lines, we …nd evidence that subjects in the high load treatment make worse choices than subjects in the low load treatment. Therefore the low quality searches do not fully explain the low quality choices. Our results suggest that cognition a¤ects choice, even in our idealized choice setting. We also …nd evidence of choice overload even when the choice set is small and the objects are simple. Further, our experimental design permits a multinomial discrete choice analysis on choice among single-attribute objects with an objective value. The results of our analysis suggest that the errors in our data are better described as having a Gumbel distribution rather than a normal distribution. Finally, we observe the e¤ects of limited cognition, consistent with memory decay and attention.

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“…There are also models in the literature that, in contrast to the self-regulation model, can imply a decrease in desire for commitment with mixtures (e.g., Noor and Takeoka [2010] and Masatlioglu, Nakajima, and Ozdenoren [2017]). More broadly, the self-regulation model is also related to a literature on cognitive control of preferences (e.g., Nehring [2006] and Koida [2017]), and to the literature on variational menu choice preferences (e.g., Ergin and Sarver [2010]). We discuss the formal connection with these other models after presenting our axiomatic characterization of the self-regulation model (see Section 6).…”

Section: Self-regulationmentioning

confidence: 99%

“…In particular, the overlap of the willpower model in Masatlioglu, Nakajima, and Ozdenoren [2017] with the self-regulation model is the Strotz model, while the overlap of the willpower model in Grant, Hsieh, and Liang [2017] with the self-regulation model is the self-control model. Similar in spirit to the discrete choice model in Nehring [2006], Koida [2017] proposes, using lotteries over menus, a model of internal conflict, where the DM can exercise cognitive control over mental states that trigger ex-post choices. Koida…”

Section: Other Related Modelsmentioning

confidence: 99%

“…However, the overlap of ASC preferences and self-regulation preferences satisfy the WNDC axiom and so they can be represented by the constrained self-regulation model in Proposition 2. Koida [2017]'s model extends this representation in two directions: (i) the set of distributions can vary with the menu, and (ii) the support of the distributions can contain non-expected utility functions. As such, ASC preferences can violate Axiom 5; hence, neither the self-regulation nor the ASC model nests the other.…”

Section: Other Related Modelsmentioning

confidence: 99%

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Mood-driven choices and self-regulation

Mihm

Ozbek

2018

Journal of Economic Theory

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We model a decision maker who can exert costly effort to regulate herself, thereby reducing internal conflicts between her normative objectives and mood-driven choices. We provide an axiomatic characterization of the model, and show how costs of self-regulation can be elicited and compared across individuals. In a consumption-saving problem we show that self-regulation can generate unintended income effects, which have important implications for public policies on saving behavior. We also provide several examples to illustrate how self-regulation can rationalize many well-known choice anomalies. These behavioral implications follow from a key feature of the model that self-regulation decisions can respond to changes in incentives.

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Anticipated stochastic choice

Cited by 10 publications

References 41 publications

An Economist and a Psychologist Form a Line: What Can Imperfect Perception of Length Tell Us About Stochastic Choice?

An Economist and a Psychologist Form a Line: What Can Imperfect Perception of Length Tell Us About Stochastic Choice?

Judgments of Length in the Economics Laboratory: Are There Brains in Choice?

Mood-driven choices and self-regulation

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