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Choice, deferral, and consistency

Author

Listed:
  • Miguel A. Costa‐Gomes
  • Carlos Cueva
  • Georgios Gerasimou
  • Matúš Tejiščák

Abstract

We report on two novel choice experiments with real goods where subjects in one treatment are forced to choose, as is the norm in economic experiments, while in the other they are not but can instead incur a small cost to defer choice. Using a variety of measures, we find that the active choices (i.e., those that exclude the deferral outside option) of subjects in the nonforced‐choice treatment are generally more consistent. We also find that the combined deferral and active‐choice behavior of subjects in that treatment is explained better by a model of dominant choice with incomplete preferences than it is by rational choice. Our results suggest that nonforced‐choice experiments and models can be helpful in separating people's rational, hesitant/not‐yet‐rational and genuinely irrational behavior, and can potentially offer important new insights in revealed preference analysis.

Suggested Citation

  • Miguel A. Costa‐Gomes & Carlos Cueva & Georgios Gerasimou & Matúš Tejiščák, 2022. "Choice, deferral, and consistency," Quantitative Economics, Econometric Society, vol. 13(3), pages 1297-1318, July.
    • Handle: RePEc:wly:quante:v:13:y:2022:i:3:p:1297-1318
    DOI: 10.3982/QE1806
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    References listed on IDEAS

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    Cited by:

    1. John D. Hey & Yudistira Permana & Nuttaporn Rochanahastin, 2018. "When and how to satisfice: an experimental investigation," World Scientific Book Chapters, in: Experiments in Economics Decision Making and Markets, chapter 5, pages 121-137, World Scientific Publishing Co. Pte. Ltd..
    2. Elias Bouacida, 2021. "Identifying Choice Correspondences," Working Papers 327800275, Lancaster University Management School, Economics Department.
    3. Georgios Gerasimou, 2021. "Towards Eliciting Weak or Incomplete Preferences in the Lab: A Model-Rich Approach," Papers 2111.14431, arXiv.org, revised Dec 2023.
    4. Qiyan Ong & Jianying Qiu, 2023. "Paying for randomization and indecisiveness," Journal of Risk and Uncertainty, Springer, vol. 67(1), pages 45-72, August.
    5. Yoram Halevy & David Walker-Jones & Lanny Zrill, 2023. "Difficult Decisions," Working Papers tecipa-753, University of Toronto, Department of Economics.

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