Publication Type
Working Paper
Version
publishedVersion
Publication Date
9-2016
Abstract
We develop an extension of Luce’s random choice model that incorporates a role forthe association of alternatives. Each alternative is characterized by a salience value, aLuce value, and its associated alternatives. The salience value captures the alternative’sability to attract the decision maker’s attention, and the Luce value measures thealternative’s desirability. The decision maker is first attracted by some alternativeaccording to a salience-based Luce-type formula, and then chooses among its associatedalternatives according to another desirability-based Luce-type formula. While retainingthe simplicity of the Luce rule, the theory accommodates some well-known behavioralphenomena in individual choice, such as the attraction effect (violations of regularity),and violations of stochastic transitivity.
Discipline
Economic Theory
Research Areas
Economic Theory
First Page
1
Last Page
29
Publisher
SMU Economic & Statistics Working Paper Series
Citation
LI, Jiangtao and TANG, Rui.
Associationistic luce rule. (2016). 1-29.
Available at: https://ink.library.smu.edu.sg/soe_research/2305
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.