Economic Theory Of Choice Research Articles

Investigating the effect of stimulus range on attribute weight.

Classic economic theories of choice assume that trade-offs are made consistently and are not swayed by irrelevant contextual variables. One possible source of trade-off inconsistency is investigated by asking whether attribute weights are affected by variations in the range of the stimuli presented. Ss should be influenced by the range of the stimuli only when distributional characteristics provide information about the value of the stimuli. In six experiments, Ss made judgments when the range (a) did not provide information about the value of the scores on the scales, (b) might provide such information, and (c) certainly provided this information. In Experiments 1-5, Ss were not influenced by the range of the stimuli. The only exception was Experiment 6, which required Ss to judge hypothetical job candidates on the basis of stimulus scales with which the Ss had no previous experience. In this experiment the meaning of the scales was determined entirely by the location of each stimulus within the presented distribution. In general, the results support the classical view of decision making: that attribute weights exist independent of situational demands, and that Ss' judgments are not influenced by irrelevant stimuli.

An Economic Theory of Choice and its Implications for Suicide

An economic model of decision making was examined for its implications for suicide. The model would focus on what permits the suicidal impulse to become manifest rather than what motivates a person to commit suicide.

The Choice Theory Approach to Market Research

This paper surveys economic choice theory, stressing developments that permit use of data from psychometric and conjoint experiments to produce market demand forecasts. Alternatives to the widely used multinomial logit model are summarized, and a new method for estimating multinomial probits is described. An integration of choice models with attitudinal scaling and perceptual mapping, within a latent variable system, is described. Estimation of such systems under either “random effects” or “fixed effects” descriptions of heterogeneity across individuals is discussed. Issues in the use of choice models to describe responses from conjoint experiments are presented. New regression diagnostic tests for the consistency of multinomial logit representations are discussed.

Risky Choices in Medical Decision Making: A Survey

Economic models of decision making under uncertainty presume five features of a decisionmaking situation. The first is a set of well-defined alternatives from which to choose. The second is uncertainty in the relation between the chosen alternative and the actual consequence. The third feature is a set preferences held by the decision maker and applied to the possible outcomes. Fourth, one or more constraints may limit the set of available alternatives. Finally, and most importantly, the decision must be made; to postpone a decision or to preserve the status quo is itself a decision with its attendant consequences. While these features are shared by many economic decisions under uncertainty, such as in purchasing insurance or in assembling an investment portfolio - and it was surely these sorts of decisions that von Neumann and Morgenstern (1947) had in mind when they developed their now classical theory of economic choice under uncertainty - these are features also shared by many decisions that arise in clinical medicine and public health. Physicians must choose between alternatives: whether to perform surgery or to administer medication, which antibiotic to use, whether to perform a risky test. Consequences of action are uncertain: Will the patient survive the operation? What disease does the patient have? What will the test show? Value judgments arise in evaluating outcomes: Is the risk of surgical mortality worth taking to relieve the pain? Are the side effects of the medicine worse than the disease? Budgetary constraints limit today's health care provider in the same way that the classical economic consumer is limited by his or her income. Finally, the decision cannot be avoided, however painful the decision-making process may be. By imposing various axioms of rational behavior on the decision maker - such as adherence to the laws of probability and transitivity of preferences - models such as the expected utility model of von Neumann and Morgenstern (1947) have been developed. These models can, and have, been used either to describe how decisions are made in fact, or to prescribe optimal decisions, that is, to help decision makers decide in a manner consistent with their own beliefs and preferences.

An Examination of Fishing Location Choice in the Pink Shrimp Fishery

This article analyzes fishing location choices made by pink shrimp (Pandalus jordani) fishermen fishing off the coast of northern California. Data were gathered for 17 commercial vessels making 3000 net sets over a season. A simple multiplechoice logit model was used to examine whether recent information on success in various regions aids in explaining location choice. Results suggest that fishermen do account for economic factors in a manner consistent with economic theories of choice.

The Distribution of Criminal Offenses in an Urban Environment: A Spatial Analysis of Criminal Spillovers and of Juvenile Offenders

Abstract. In order to derive a basis for an optimal allocation of police manpower among contiguous communities criminal spillovers among these communities must be explicitly taken into account. Under the assumptions established in the economic theory of choice a criminal spillovers model is derived. The hypothesized variables within this model which serve as motivating factors for criminal spillovers are economic gain and competitive criminal pressures. Those factors which deter criminal spillovers are costs of committing offenses and the relative risks in committing crimes in distant communities. The model is then tested using data on juvenile offenders supplied by the City of Los Angeles, for the crimes of robbery, burglary and larceny. The results suggest that on an aggregate basis juvenile criminal behavior is not purely opportunistic and that certain control and motivating factors are significant in the juvenile's judgments for the spatial selection of offense targets.

A sufficient condition for continuity of optimal sets in mathematical programming

This paper develops a sufficient condition for continuity (as opposed to upper semicontinuity) of the optimal set of a mathematical program. Applications to the theory of economic choice are discussed.

An Illustration of the Use of Analytical Theory in Sociology the Application of the Economic Theory of Choice to Non-Economic Variables

Recent developments in the philosophy of science have made it increasingly clear that scientific inquiry may employ various formal languages. Sociology, in the main, is committed to the language of functionalism, but other languages might be used. Furthermore, there are certain inherent limitations in the functional approach which confine analysis to a small number of possible states of systems. Analytical theories, taking as a basic axiom an incremental ranking system for all concepts, would permit discussion of ranges of values of variables and of varying relationships between them, and thus allow for the treatment of different types of systems and of various states of one system. The use of analytic theory in sociology is illustrated by the application of the economic theory of choice to a system of non-economic variables.

A Study of Irrational Judgments

T HERE is an important difference of opinion among social scientists concerning whether human behavior is rational or irrational. Traditionally, economic theory has been based on an assumption that behavior is rational, in a specific sense to be defined shortly, whereas most psychological and sociological theory insists that behavior is, at least largely, irrational. Some of the more advanced workers in psychiatry and anthropology have been discovering that much of what superficially appears to be irrational, in terms of what the outside observer considers to be the interests of the subject or the information available to him, is really rational when certain premises of thought-often repressed or at least hidden-are taken into consideration. These newer discoveries pose for research the question of whether human behavior is ever irrational in terms of the value judgments held by the individual or the group and the information available to them. This question remains a crucial one for the economic theory of choice, and its resolution will strongly influence the future direction of economic theory, as well as the relationship of economics to the other social sciences. Some writers in econometrics have claimed that most of the empirical assumptions of the older economists can now be abandoned but that the assumption of is still crucial and must be so, or economics can be nothing more than a descriptive science of the sort envisioned by the institutionalists. By rationality they usually mean in effect transitivity,2 or an internally coherent choice pattern such that if an individual chooses A in preference to B, and B in preference to C, then he will choose A in preference to C.3 The relationship need not logically be that of preference, although it always is in economics. Edwards cites the extensive economic literature in which it is demonstrated that transitivity of preferences (for commodity bundles) is a necessity for conventional economic theory. The psychological assumption behind

Social Choice and Individual Values.

Originally published in 1951, Social Choice and Individual Values introduced Impossibility Theorem and founded the field of social choice theory in economics and political science. This new edition, including a new foreword by Nobel laureate Eric Maskin, reintroduces Arrow's seminal book to a new generation of students and researchers. Far beyond a classic, this small book unleashed the ongoing explosion of interest in social choice and voting theory. A half-century later, the book remains full of profound insight: its central message, 'Arrow's Theorem,' has changed the way we think.-Donald G. Saari, author of Decisions and Elections: Explaining the Unexpected