IDEAS home Printed from https://ideas.repec.org/a/bla/kyklos/v78y2025i1p74-85.html
   My bibliography  Save this article

The decoy effect only works when the number of options is less than six

Author

Listed:
  • Subrato Banerjee
  • Pragathi Kandregula

Abstract

The decoy effect is a well‐documented source of violation of elements of demand theory. We experimentally demonstrate that the decoy effect only works when the number of options is limited (specifically not more than five). This is because, with more and more options, it may get difficult for consumers to spot the decoy (against which a Pareto dominant option is made to look more attractive), rendering the decoy effect ineffective. Identifying that the decoy effect works because it facilitates easier choice‐making, we observe that the difficulty in choice‐making with or without the decoy is statistically the same when the number of options to choose from is six or more.

Suggested Citation

  • Subrato Banerjee & Pragathi Kandregula, 2025. "The decoy effect only works when the number of options is less than six," Kyklos, Wiley Blackwell, vol. 78(1), pages 74-85, February.
  • Handle: RePEc:bla:kyklos:v:78:y:2025:i:1:p:74-85
    DOI: 10.1111/kykl.12413
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/kykl.12413
    Download Restriction: no

    File URL: https://libkey.io/10.1111/kykl.12413?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:kyklos:v:78:y:2025:i:1:p:74-85. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=0023-5962 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.