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Default Bias in Extended Choice Rules

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  • Somdeb Lahiri

Abstract

In this paper we provide a reader friendly axiomatic characterization of the default bias extended choice rule, in the framework available in lecture 3 of Rubinstein (2016) . As noted there “experimental evidence and introspection tell us that a default option is often viewed positively by a decision maker, a phenomenon known as the status quo bias†. A different axiomatic characterization of the extended choice rule is available in that lecture. Our proof makes use of the Szpilrajn's extension which for finite sets (as in our case) has a very simple proof. JEL Classification: D01, D03

Suggested Citation

  • Somdeb Lahiri, 2019. "Default Bias in Extended Choice Rules," Studies in Microeconomics, , vol. 7(1), pages 1-6, June.
    • Handle: RePEc:sae:miceco:v:7:y:2019:i:1:p:1-6
    DOI: 10.1177/2321022219830187
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    References listed on IDEAS

    as
    1. Masatlioglu, Yusufcan & Ok, Efe A., 2005. "Rational choice with status quo bias," Journal of Economic Theory, Elsevier, vol. 121(1), pages 1-29, March.
    2. Sagi, Jacob S., 2006. "Anchored preference relations," Journal of Economic Theory, Elsevier, vol. 130(1), pages 283-295, September.
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    More about this item

    Keywords

    Extended choice rule; default bias; preference;
    All these keywords.

    JEL classification:

    • D01 - Microeconomics - - General - - - Microeconomic Behavior: Underlying Principles
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles

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