Bounded Rationality as Subjective Menus: Contraction Consistency and Intertemporal Choice

2009 ◽  
Author(s):  
Dean Spears
Keyword(s):  
Bounded Rationality ◽  
Intertemporal Choice

Intertemporal Bounded Rationality as Consideration Sets with Contraction Consistency

2011 ◽  
Vol 11 (1) ◽  
Author(s):  
Dean Spears
Keyword(s):  
Bounded Rationality ◽  
Decision Maker ◽  
Intertemporal Choice ◽  
Rational Agent ◽  
Consideration Sets ◽  
Model Choice ◽  
Rational Decision ◽  
Choice Sets

How would a boundedly rational agent react to a larger menu? I model choice from an unobservable, subjective consideration subset. Consideration sets satisfy Sen’s property alpha: larger objective choice sets can generate smaller consideration sets. The contribution of this paper is a representation of choice among menus: choice sets are only as valuable as the best item in their subjective subsets, so larger sets can be worse. Unlike people facing temptation, a boundedly rational decision maker can strictly prefer both of two choice sets to their union. This model of intertemporal choice reflects how an agent who satisfies Weak WARP would choose, if sophisticated about her bounded rationality.

(Un)Bounded Rationality

1985 ◽  
Vol 30 (4) ◽  
pp. 263-265
Author(s):  
Donald E. Broadbent
Keyword(s):  
Bounded Rationality

Probabilistic Intertemporal Choice and Framing Effects

2002 ◽  
Author(s):  
Tamar R. Malinek ◽  
Daniel M. Oppenheimer
Keyword(s):  
Intertemporal Choice ◽  
Framing Effects
Sign in / Sign up

Export Citation Format

Share Document