TY  - RPRT
        AU  - Manzini, Paola
AU  - Mariotti, Marco
        TI  - A Salience Theory of Choice Errors
        PY  - 2010/Jun/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 5006
        UR  - https://www.iza.org/index.php/publications/dp5006
        AB  - We study a psychologically based foundation for choice errors. The decision maker applies a preference ranking after forming a 'consideration set' prior to choosing an alternative. Membership of the consideration set is determined both by the alternative specific salience and by the rationality of the agent (his general propensity to consider all alternatives). The model turns out to include a logit formulation as a special case. In general, it has a rich set of implications both for exogenous parameters and for a situation in which alternatives can affect their own salience (salience games). Such implications are relevant to assess the link between 'revealed' preferences and 'true' preferences: for example, less rational agents may paradoxically express their preference through choice more truthfully than more rational agents.
        KW  - discrete choice
KW  - random utility
KW  - logit model
KW  - consideration sets
KW  - bounded rationality
        ER  -