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on Microeconomics |
| By: | Matsuki, Jun; Tadenuma, Koichi |
| Abstract: | In this paper, we consider a natural procedure of decision-making, called a “Grouping Choice Method”, which leads to a kind of bounded rational choices. In this procedure a decision-maker (DM) first divides the set of available alternatives into some groups and in each group she chooses the best element (winner) for her preference relation. Then, among the winners in the first round, she selects the best one as her final choice. We characterize Grouping Choice Methods in three different ways. First, we show that a choice function is a Grouping Choice Method if and only if it is a Rational Shortlist Method (Manzini and Mariotti, 2007) in which the first rationale is transitive. Second, Grouping Choice Methods are axiomatically characterized by means of a new axiom called Elimination, in addition to two well-known axioms, Expansion and Weak WARP (Manzini and Mariotti, 2007). Third, Grouping Choice Methods are also characterized by a weak version of Path Independence. |
| Keywords: | grouping of alternatives, preference, bounded rationality |
| JEL: | D01 |
| Date: | 2013–09 |
| URL: | http://d.repec.org/n?u=RePEc:hit:econdp:2013-08&r=mic |
| By: | Marek Hudík |
| Abstract: | The fact that any two choices are necessarily asynchronous raises the question of whether some alternative x at moment t remains the same alternative x at moment t + 1. It is argued that this question cannot be answered without taking into account the decision-maker’s perception of the choice problem. Consequently, an objective description of a choice problem is impossible for each description involves an interpretation. A definition of sameness is provided and an extension of the standard choice model is suggested. The problem of the possibility of different perceptions of the decision-maker and the observer is emphasized |
| Keywords: | sameness, categorization, internal consistency, choice theory, indifference, framing, subjectivism |
| JEL: | B40 D01 D03 |
| Date: | 2013–06 |
| URL: | http://d.repec.org/n?u=RePEc:icr:wpicer:02-2013&r=mic |