Search with multiple attributes: Theory and empirics
نویسنده
چکیده
Multiple attribute search is a central feature of economic life: we consider much more than price when purchasing a home, and more than wage when choosing a job. Nevertheless, while single attribute search problems have been studied extensively, little is known about optimal search in multiple attribute environments. I introduce a partial characterization of optimal sequential search in a problem with multiple searchable attributes and alternatives, no order restrictions on search, and full recall. Upon applying the partial rational benchmark to a rich dataset I find that subjects systematically deviate from optimal sequential search by (1) searching too deeply within alternatives and (2) switching too adjacently between alternatives. Finally, I explore how these deviations affect payoffs, and explain why they may constitute a form of boundedly rational search behavior in which subjects re-optimize only occassionally, while “smoothing” search order so as to make costly memory failures less likely. JEL Classification Numbers: D11; D12; D81; D83.
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ورودعنوان ژورنال:
- Games and Economic Behavior
دوره 104 شماره
صفحات -
تاریخ انتشار 2017