Breitmoser, Yves (2016): Stochastic choice, systematic mistakes and preference estimation.

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Abstract
Individual choice exhibits "presentation effects" such as default, ordering and roundnumber effects. Using existing models, presentation effects bias utility estimates, which suggests instability of preferences and obscures behavioral patterns. This paper derives a generalized model of stochastic choice by weakening logit's axiomatic foundation. Weakening the axioms implies that focality of options is choicerelevant, alongside utility, which entails presentation effects. The model is tested on four wellknown studies of dictator games exhibiting typical roundnumber patterns. The generalized logit model captures the choice patterns reliably, substantially better than existing models: it robustly predicts and controls for the roundnumber effects, thus provides "clean" utility estimates that are stable and predictive across experiments.
Item Type:  MPRA Paper 

Original Title:  Stochastic choice, systematic mistakes and preference estimation 
Language:  English 
Keywords:  stochastic choice, systematic mistakes, axiomatic foundation, utility estimation, dictator game 
Subjects:  C  Mathematical and Quantitative Methods > C1  Econometric and Statistical Methods and Methodology: General > C10  General C  Mathematical and Quantitative Methods > C9  Design of Experiments > C90  General D  Microeconomics > D0  General > D03  Behavioral Microeconomics: Underlying Principles 
Item ID:  72779 
Depositing User:  Yves Breitmoser 
Date Deposited:  31 Jul 2016 04:45 
Last Modified:  31 Jul 2016 04:46 
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URI:  https://mpra.ub.unimuenchen.de/id/eprint/72779 