IDEAS home Printed from https://ideas.repec.org/p/arx/papers/2301.05649.html
   My bibliography  Save this paper

Filtering Down to Size: A Theory of Consideration

Author

Listed:
  • Tonna Emenuga

Abstract

The standard rational choice model describes individuals as making choices by selecting the best option from a menu. A wealth of evidence instead suggests that individuals often filter menus into smaller sets - consideration sets - from which choices are then made. I provide a theoretical foundation for this phenomenon, developing a formal language of axioms to characterize how consideration sets are formed from menus. I posit that consideration filters - mappings that translate a menu into one of its subsets - capture this process, and I introduce several properties that consideration filters can have. I then extend this core model to provide linkages with the sequential choice and rational attention literatures. Finally, I explore whether utility representation is feasible under this consideration model, conjecturing necessary and sufficient conditions for consideration-mediated choices to be rationalizable.

Suggested Citation

  • Tonna Emenuga, 2023. "Filtering Down to Size: A Theory of Consideration," Papers 2301.05649, arXiv.org.
    • Handle: RePEc:arx:papers:2301.05649
    as

    Download full text from publisher

    File URL: http://arxiv.org/pdf/2301.05649
    File Function: Latest version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Shaun Larcom & Ferdinand Rauch & Tim Willems, 2017. "The Benefits of Forced Experimentation: Striking Evidence from the London Underground Network," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 132(4), pages 2019-2055.
    2. Apesteguia, Jose & Ballester, Miguel A., 2013. "Choice by sequential procedures," Games and Economic Behavior, Elsevier, vol. 77(1), pages 90-99.
    3. Herbert A. Simon, 1955. "A Behavioral Model of Rational Choice," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 69(1), pages 99-118.
    4. Yusufcan Masatlioglu & Daisuke Nakajima, 2015. "Completing Incomplete Revealed Preference Under Limited Attention," The Japanese Economic Review, Japanese Economic Association, vol. 66(3), pages 285-299, September.
    5. 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.
    6. Paola Manzini & Marco Mariotti, 2007. "Sequentially Rationalizable Choice," American Economic Review, American Economic Association, vol. 97(5), pages 1824-1839, December.
    7. Tülin Erdem & Michael P. Keane, 1996. "Decision-Making Under Uncertainty: Capturing Dynamic Brand Choice Processes in Turbulent Consumer Goods Markets," Marketing Science, INFORMS, vol. 15(1), pages 1-20.
    8. , & ,, 2011. "Search, choice, and revealed preference," Theoretical Economics, Econometric Society, vol. 6(1), January.
    9. Hauser, John R & Wernerfelt, Birger, 1990. "An Evaluation Cost Model of Consideration Sets," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 16(4), pages 393-408, March.
    10. Jason Abaluck & Jonathan Gruber, 2016. "Evolving Choice Inconsistencies in Choice of Prescription Drug Insurance," American Economic Review, American Economic Association, vol. 106(8), pages 2145-2184, August.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Xiaosheng Mu, 2021. "Sequential Choice with Incomplete Preferences," Working Papers 2021-35, Princeton University. Economics Department..
    2. Luigi Mittone & Mauro Papi, 2017. "Does inducing choice procedures make individuals better off? An experimental study," Theory and Decision, Springer, vol. 83(1), pages 37-59, June.
    3. Papi, Mauro, 2012. "Satisficing choice procedures," Journal of Economic Behavior & Organization, Elsevier, vol. 84(1), pages 451-462.
    4. Andrew Caplin & Mark Dean & Daniel Martin, 2011. "Search and Satisficing," American Economic Review, American Economic Association, vol. 101(7), pages 2899-2922, December.
    5. Kashaev, Nail & Aguiar, Victor H., 2022. "A random attention and utility model," Journal of Economic Theory, Elsevier, vol. 204(C).
    6. Manzini, Paola & Mariotti, Marco & Tyson, Christopher J., 2016. "Partial knowledge restrictions on the two-stage threshold model of choice," Journal of Mathematical Economics, Elsevier, vol. 64(C), pages 41-47.
    7. Alfio Giarlotta & Angelo Petralia & Stephen Watson, 2022. "On the number of non-isomorphic choices on four elements," Papers 2206.06840, arXiv.org.
    8. Alfio Giarlotta & Angelo Petralia, 2024. "Simon’s bounded rationality," Decisions in Economics and Finance, Springer;Associazione per la Matematica, vol. 47(1), pages 327-346, June.
    9. Xi Zhi Lim, 2022. "Choice and Attention across Time," Papers 2203.03243, arXiv.org, revised Mar 2024.
    10. Peter Stüttgen & Peter Boatwright & Robert T. Monroe, 2012. "A Satisficing Choice Model," Marketing Science, INFORMS, vol. 31(6), pages 878-899, November.
    11. Qin, Dan, 2024. "A simple model of two-stage choice," Journal of Mathematical Economics, Elsevier, vol. 112(C).
    12. Giarlotta, Alfio & Petralia, Angelo & Watson, Stephen, 2022. "Bounded rationality is rare," Journal of Economic Theory, Elsevier, vol. 204(C).
    13. Yusufcan Masatlioglu & Daisuke Nakajima & Erkut Y. Ozbay, 2012. "Revealed Attention," American Economic Review, American Economic Association, vol. 102(5), pages 2183-2205, August.
    14. Christopher Tyson, 2013. "Behavioral implications of shortlisting procedures," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 41(4), pages 941-963, October.
    15. Bhavook Bhardwaj & Siddharth Chatterjee, 2022. "Decisions over Sequences," Papers 2203.00070, arXiv.org, revised Sep 2022.
    16. Eddie Dekel & Barton L. Lipman, 2010. "How (Not) to Do Decision Theory," Annual Review of Economics, Annual Reviews, vol. 2(1), pages 257-282, September.
    17. Andrew Caplin & Daniel Martin, 2015. "A Testable Theory of Imperfect Perception," Economic Journal, Royal Economic Society, vol. 125(582), pages 184-202, February.
    18. Bleile, Jörg, 2016. "Limited Attention in Case-Based Belief Formation," Center for Mathematical Economics Working Papers 518, Center for Mathematical Economics, Bielefeld University.
    19. Kops, Christopher, 2022. "Cluster-shortlisted choice," Journal of Mathematical Economics, Elsevier, vol. 102(C).
    20. Guney, Begum, 2014. "A theory of iterative choice in lists," Journal of Mathematical Economics, Elsevier, vol. 53(C), pages 26-32.

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:arx:papers:2301.05649. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: arXiv administrators (email available below). General contact details of provider: http://arxiv.org/ .

    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.