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Associative Networks in Decision Making

Author

Listed:
  • Jiangtao Li
  • Rui Tang
  • Mu Zhang

Abstract

We present a model of associative networks that captures how decision makers expand their consideration set through mental associations between alternatives. Our model provides a tractable approach to study how associations shape choice when some alternatives are available and others are merely observable but unavailable. We characterize the model within a random attention framework and demonstrate unique identification of all parameters. This framework delivers a unified account of several prominent choice anomalies, including classic menu effects and their ``phantom'' counterparts. We illustrate how associative links serve as a strategic variable in applications such as branding, imitation, and platform design.

Suggested Citation

  • Jiangtao Li & Rui Tang & Mu Zhang, 2026. "Associative Networks in Decision Making," Papers 2608.09739, arXiv.org.
    • Handle: RePEc:arx:papers:2608.09739
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    References listed on IDEAS

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    1. Huber, Joel & Payne, John W & Puto, Christopher, 1982. "Adding Asymmetrically Dominated Alternatives: Violations of Regularity and the Similarity Hypothesis," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 9(1), pages 90-98, June.
    2. Jason Abaluck & Abi Adams-Prassl, 2021. "What do Consumers Consider Before They Choose? Identification from Asymmetric Demand Responses," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 136(3), pages 1611-1663.
    3. Kashaev, Nail & Aguiar, Victor H., 2022. "A random attention and utility model," Journal of Economic Theory, Elsevier, vol. 204(C).
    4. Liangyan Wang & Brian Wu & Cornelia Pechmann & Yitong Wang, 2023. "The performance effects of creative imitation on original products: Evidence from lab and field experiments," Strategic Management Journal, Wiley Blackwell, vol. 44(1), pages 171-196, January.
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