TY - JOUR
T1 - Deliberately stochastic
AU - Cerreia-Vioglio, Simone
AU - Dillenberger, David
AU - Ortoleva, Pietro
AU - Riella, Gil
N1 - Publisher Copyright:
© 2019 American Economic Association. All rights reserved.
PY - 2019/7
Y1 - 2019/7
N2 - We study stochastic choice as the outcome of deliberate randomization. We derive a general representation of a stochastic choice function where stochasticity allows the agent to achieve from any set the maximal element according to her underlying preferences over lotteries. We show that in this model stochasticity in choice captures complementarity between elements in the set, and thus necessarily implies violations of Regularity/Monotonicity, one of the most common properties of stochastic choice. This feature separates our approach from other models, e.g., Random Utility.
AB - We study stochastic choice as the outcome of deliberate randomization. We derive a general representation of a stochastic choice function where stochasticity allows the agent to achieve from any set the maximal element according to her underlying preferences over lotteries. We show that in this model stochasticity in choice captures complementarity between elements in the set, and thus necessarily implies violations of Regularity/Monotonicity, one of the most common properties of stochastic choice. This feature separates our approach from other models, e.g., Random Utility.
UR - http://www.scopus.com/inward/record.url?scp=85068324915&partnerID=8YFLogxK
UR - http://www.scopus.com/inward/citedby.url?scp=85068324915&partnerID=8YFLogxK
U2 - 10.1257/aer.20180688
DO - 10.1257/aer.20180688
M3 - Article
AN - SCOPUS:85068324915
SN - 0002-8282
VL - 109
SP - 2425
EP - 2445
JO - American Economic Review
JF - American Economic Review
IS - 7
ER -