Combining preferences and heuristics in analysing consumer behaviour

Abstract

This paper proposes a seminal model that combines heuristics and preferences to analyse decision-making processes related to the consumption of goods and services. The model has been built by recombining different results from economic psychology and in particular from the research programme called ecological rationality or environment-consistent rationality. With regard to heuristics and their algorithms, in addition to the well-known lexicographic rule, the importance of the heuristics of recognition, weighting and adding, sufficient satisfaction, reciprocity, default choice and imitate-the-majority heuristic in consumer behaviour is underscored. This last heuristic is complemented by the critical mass model and preliminary ideas on the loyalty effect. With respect to preferences, a distinction is made between elementary and final preferences, and between raw and inferential preferences. These two dimensions can be combined, giving rise to a conceptual framework which allows the concept of preferences to be consolidated and expanded. Although much work remains to be done, it should be stressed that this approach could be very fertile in gaining thorough understanding of the determinants of consumption choices.