Aspiration-based choice
Type :
Article
Publication Status :
Published
Access :
restrictedAccess
Abstract
Numerous studies and experiments suggest that aspirations for desired but perhaps unavailable alternatives influence decisions. A common finding is that an unavailable aspiration steers agents to choose similar available alternatives. We propose and axiomatically characterize a choice theory consistent with this aspirational effect. Similarity is modeled using a subjective metric derived from choice data. This model offers implications for consumer welfare and its distribution between rich and poor when firms compete for aspirational agents, and a novel rationale for sales.
Source :
Journal of Economic Theory
Date :
2018-07
Volume :
176
Publisher :
Elsevier
URI
http://hdl.handle.net/10679/5999https://www.sciencedirect.com/science/article/pii/S0022053118301613
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