Scandinavian Working Papers in Economics
Working Paper Series,
Research Institute of Industrial Economics
No 1145: Differences Attract: An Experimental Study of Focusing in Economic Choice
Ola Andersson (), Jim Ingebretsen Carlson () and Erik Wengström ()
Additional contact information
Ola Andersson: Research Institute of Industrial Economics (IFN), Postal: and Department of Economics, Lund University
Jim Ingebretsen Carlson: Department of Economics, Postal: Lund University
Erik Wengström: Department of Economics, Postal: Lund University
Abstract: Several recent behavioral models of choice build on the idea that decision makers put more weight on attributes in which the available options differ more. We test this assumption in a controlled experiment where such biases will generate choice inconsistencies. As hypothesized, we find that subjects make more inconsistent choices when we add new options that affect the maximal difference in attributes among the options. Our findings suggest that the decision maker's focus is drawn to attributes that stand out. We also test the focusing effect against theories of decoy effects (asymmetric dominance), but we find that the focus effect dominates.
Keywords: Individual decision making; Focus; Attention; Salience; Decoy; Experiments
84 pages, December 14, 2016
Full text files
wp1145.pdf
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