Satisficing and maximizing consumers in a monopolistic screening model
We study a simple model in which a monopolist supplies a multi-attribute good and does not know whether the consumer is an expected-utility maximizer or a boundedly rational type that follows the satisficing heuristic proposed by Herbert Simon. We find that, unless the probability of the consumer being fully rational is sufficiently high, the fact that a boundedly rational consumer never exchanges satisfactory with unsatisfactory alternatives implies that he/she never ends up with an alternative strictly better than his/her aspiration levels.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Christopher J.Tyson, 2005.
"Axiomatic Foundations for Satisficing Behavior,"
2005-W03, Economics Group, Nuffield College, University of Oxford.
- Tyson, Christopher J., 2008. "Cognitive constraints, contraction consistency, and the satisficing criterion," Journal of Economic Theory, Elsevier, vol. 138(1), pages 51-70, January.
- Christopher J. Tyson, 2007. "Cognitive Constraints, Contraction Consistency, and the Satisficing Criterion," Working Papers 614, Queen Mary University of London, School of Economics and Finance.
- Christopher Tyson, 2005. "Axiomatic Foundations for Satisficing Behavior," Economics Series Working Papers 2005-W03, University of Oxford, Department of Economics.
- Tyson, Chris, 2001. "The Foundations of Imperfect Decision Making," Research Papers 1714, Stanford University, Graduate School of Business.
- Elena Reutskaja & Rosemarie Nagel & Colin F. Camerer & Antonio Rangel, 2011. "Search Dynamics in Consumer Choice under Time Pressure: An Eye-Tracking Study," American Economic Review, American Economic Association, vol. 101(2), pages 900-926, April.
- Rubinstein, Ariel & Salant, Yuval, 2006. "A model of choice from lists," Theoretical Economics, Econometric Society, vol. 1(1), pages 3-17, March.
- Jose Apesteguia & Miguel�Angel Ballester, 2011.
"Welfare of Naive and Sophisticated Players in School Choice,"
575, Barcelona Graduate School of Economics.
- Apesteguia, Jose & Ballester, Miguel A., 2012. "Welfare of naive and sophisticated players in school choice," Economics Letters, Elsevier, vol. 115(2), pages 172-174.
- Jose Apesteguia & Miguel A. Ballester, 2011. "Welfare of naive and sophisticated players in school choice," Economics Working Papers 1280, Department of Economics and Business, Universitat Pompeu Fabra.
- Atila Abdulkadiroglu & Yeon-Koo Che & Yosuke Yasuda, 2011. "Resolving Conflicting Preferences in School Choice: The "Boston Mechanism" Reconsidered," American Economic Review, American Economic Association, vol. 101(1), pages 399-410, February.
- Andrew Caplin & Mark Dean & Daniel Martin, 2011. "Search and Satisficing," American Economic Review, American Economic Association, vol. 101(7), pages 2899-2922, December.
- Ran Spiegler, 2005.
"Competition over Agents with Boundedly Rational Expectations,"
122247000000000535, UCLA Department of Economics.
- Spiegler, Ran, 2006. "Competition over agents with boundedly rational expectations," Theoretical Economics, Econometric Society, vol. 1(2), pages 207-231, June.
- Caplin, Andrew & Dean, Mark, 2011. "Search, choice, and revealed preference," Theoretical Economics, Econometric Society, vol. 6(1), January.
- Spiegler, Ran, 2011.
"Bounded Rationality and Industrial Organization,"
Oxford University Press, number 9780195398717, March.
- Papi, Mauro, 2012. "Satisficing choice procedures," Journal of Economic Behavior & Organization, Elsevier, vol. 84(1), pages 451-462.
- Parag A. Pathak & Tayfun Sonmez, 2008. "Leveling the Playing Field: Sincere and Sophisticated Players in the Boston Mechanism," American Economic Review, American Economic Association, vol. 98(4), pages 1636-52, September.
When requesting a correction, please mention this item's handle: RePEc:eee:matsoc:v:66:y:2013:i:3:p:385-389. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei)
If references are entirely missing, you can add them using this form.