Rationalizing Choice with Multi-Self Models

Abstract:

To facilitate systematic study of multi-self (or group) decision making, this paper proposes a framework that encompasses a variety of models proposed in economics, psychology, and marketing. We model choice as arising from the aggregation of a collection of utility functions. We propose a method for characterizing the extent of irrationality of a choice behavior, and use this measure to provide a lower bound on the set of choice behaviors that can be rationalized with n utility functions. Within a class of models, generically at most five “reasons” are needed for every “mistake.”

Last updated on 12/04/2012