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Choice by iterative search

  • Nakajima, Daisuke


    (Department of Economics, Otaru University of Commerce)

  • Masatlioglu, Yusufcan


    (Department of Economics, University of Michigan)

When making choices, decision makers often either lack information about alternatives or lack the cognitive capacity to analyze every alternative. To capture these situations, we formulate a framework to study behavioral search by utilizing the idea of consideration sets. Consumers engage in a dynamic search process. At each stage, they consider only those options in the current consideration set. We provide behavioral postulates characterizing this model. We illustrate how one can identify both search paths and preferences.

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Article provided by Econometric Society in its journal Theoretical Economics.

Volume (Year): 8 (2013)
Issue (Month): 3 (September)

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Handle: RePEc:the:publsh:1014
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