Limited consideration and aspiration based decision-making in simple allocation problems

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Çalıcı, Ekin (2016) Limited consideration and aspiration based decision-making in simple allocation problems. [Thesis]

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Abstract

In this thesis, we carry out a revealed preference analysis on a class of solutions to simple allocation problems. We adapt two di¤erent models of decision making into the simple allocation problems literature. We introduce and characterize the Limited Consideration Choice Model. In this model, a constraint function generated from the characteristic vector narrows down the feasible alternatives by forming the consideration set. The intuition behind this model is that the decision maker is not aware of all feasible alternatives and a reference point can change the choice of the decision maker. We next de�ne some consistency and fairness properties over the constraint function and analyze their implications over the Limited Consideration Choice Models. We next introduce and characterize an Aspiration Based Choice Model. In this model, a distance minimization procedure between the aspiration point that is endogenously determined within the model and the feasible set of alternatives is used. The intuition behind this model is capturing the notion of resemblance in the mind of the decision maker using a subjective distance function. We prove that using the P-norm metric as in the Yu family used in the bargaining literature with p > 1 within this model gives the Constrained Equal Losses Rule.
Item Type: Thesis
Uncontrolled Keywords: Revealed preference. -- Rational. -- Simple allocation problems. -- Reference dependence. -- Attention. -- Aspiration. -- Açıklanan tercih. -- Rasyonel. -- Basit dağıtım problemleri. -- Referansa bağlılık. -- Değerlendirme. -- Esinlenme.
Subjects: H Social Sciences > HB Economic Theory
Divisions: Faculty of Arts and Social Sciences > Academic programs > Economics
Faculty of Arts and Social Sciences
Depositing User: IC-Cataloging
Date Deposited: 29 Sep 2017 09:55
Last Modified: 26 Apr 2022 10:11
URI: https://research.sabanciuniv.edu/id/eprint/34018

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