Book contents
- Frontmatter
- Contents
- Figures
- Preface
- 1 Preferences, Comparative Evaluations, and Reasons
- Part I Preferences in Positive Economics
- Part II Preferences, Welfare, and Normative Economics
- Part III Psychology, Rational Evaluation, and Preference Formation
- 9 The Psychology of Choice
- 10 Constructing Preferences
- 11 Conclusions
- References
- Index
9 - The Psychology of Choice
from Part III - Psychology, Rational Evaluation, and Preference Formation
Published online by Cambridge University Press: 05 June 2012
- Frontmatter
- Contents
- Figures
- Preface
- 1 Preferences, Comparative Evaluations, and Reasons
- Part I Preferences in Positive Economics
- Part II Preferences, Welfare, and Normative Economics
- Part III Psychology, Rational Evaluation, and Preference Formation
- 9 The Psychology of Choice
- 10 Constructing Preferences
- 11 Conclusions
- References
- Index
Summary
This chapter discusses empirical evidence concerning how people evaluate alternatives and make choices and how this evidence bears on the standard model of choice and the axioms governing preference to which economist are committed. It also compares the standard model of choice to ways in which psychologists theorize about action. These are large topics, but the issues I shall address are relatively narrow.
At the core of choice theory are the axioms discussed in Chapter 2: completeness, transitivity, context-independence, and choice determination. If people were able to carry out total comparative evaluations of all the alternatives they face, one would expect these axioms to be true. But economists do not believe that people’s preferences are always complete, transitive, and context-independent. The axioms are approximations or idealizations. The fact that people violate transitivity when presented with enough pairwise choices does not imply that economists should not model the typical consumer’s weekly grocery shopping as governed by a transitive total subjective ranking. Even the demonstration that some plausible methods of evaluating alternatives lead to intransitivities (e.g., Tversky 1969) need not be alarming if those methods are unlikely to be important in the domain in which economists apply the standard model of choice.
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- Information
- Preference, Value, Choice, and Welfare , pp. 107 - 116Publisher: Cambridge University PressPrint publication year: 2011