Journal
ECONOMETRICA
Volume 82, Issue 3, Pages 1153-1176Publisher
WILEY
DOI: 10.3982/ECTA10575
Keywords
Discrete choice; random utility; logit model; Luce model; consideration sets; bounded rationality; revealed preferences
Categories
Funding
- ESRC [ES/J012513/1]
- ESRC [ES/J012513/1] Funding Source: UKRI
- Economic and Social Research Council [ES/J012513/1] Funding Source: researchfish
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We model a boundedly rational agent who suffers from limited attention. The agent considers each feasible alternative with a given (unobservable) probability, the attention parameter, and then chooses the alternative that maximizes a preference relation within the set of considered alternatives. We show that this random choice rule is the only one for which the impact of removing an alternative on the choice probability of any other alternative is asymmetric and menu independent. Both the preference relation and the attention parameters are identified uniquely by stochastic choice data.
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