Abstract
Several decision models in marketing science and psychology assume that a consumer chooses by proceeding sequentially through a checklist of desirable properties. These models are contrasted to the utility maximization model of rationality in economics. We show on the contrary that the two approaches are nearly equivalent. Since the number of preference discriminations that an agent can make increases exponentially in the number of properties used, checklists provide a rapid procedural basis for utility maximization.
Original language | English |
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Pages (from-to) | 71-92 |
Number of pages | 22 |
Journal | Journal of Economic Theory |
Volume | 147 |
Issue number | 1 |
DOIs | |
Publication status | Published - Jan 2012 |
Bibliographical note
Copyright:Copyright 2011 Elsevier B.V., All rights reserved.
Research Groups and Themes
- ECON Microeconomic Theory
Keywords
- Bounded rationality
- Choice function
- Lexicographic utility
- Utility maximization