Search and satisficing

Andrew Caplin, Mark Dean, Daniel Martin

    Research output: Contribution to journalArticle

    Abstract

    Many everyday decisions are made without full examination of all available options, and, as a result, the best available option may be missed. We develop a search-theoretic choice experiment to study the impact of incomplete consideration on the quality of choices. We find that many decisions can be understood using the satisficing model of Herbert Simon (1955): most subjects search sequentially, stopping when a "satisficing" level of reservation utility is realized. We find that reservation utilities and search order respond systematically to changes in the decision making environment.

    Original languageEnglish (US)
    Pages (from-to)2899-2922
    Number of pages24
    JournalAmerican Economic Review
    Volume101
    Issue number7
    DOIs
    StatePublished - Dec 2011

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    Satisficing
    Reservation
    Herbert Simon
    Choice experiment
    Decision making

    ASJC Scopus subject areas

    • Economics and Econometrics

    Cite this

    Caplin, A., Dean, M., & Martin, D. (2011). Search and satisficing. American Economic Review, 101(7), 2899-2922. https://doi.org/10.1257/aer.101.7.2899

    Search and satisficing. / Caplin, Andrew; Dean, Mark; Martin, Daniel.

    In: American Economic Review, Vol. 101, No. 7, 12.2011, p. 2899-2922.

    Research output: Contribution to journalArticle

    Caplin, A, Dean, M & Martin, D 2011, 'Search and satisficing', American Economic Review, vol. 101, no. 7, pp. 2899-2922. https://doi.org/10.1257/aer.101.7.2899
    Caplin A, Dean M, Martin D. Search and satisficing. American Economic Review. 2011 Dec;101(7):2899-2922. https://doi.org/10.1257/aer.101.7.2899
    Caplin, Andrew ; Dean, Mark ; Martin, Daniel. / Search and satisficing. In: American Economic Review. 2011 ; Vol. 101, No. 7. pp. 2899-2922.
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