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Categorize then choose: Boundedly rational choice and welfare
journal contributionposted on 2022-10-28, 02:07 authored by P Manzini, Marco MariottiMarco Mariotti
We propose a boundedly rational model of choice where agents categorize alternatives before choosing. The model explains some behavioral anomalies, and it is fully characterized by a property of choice data: a categorizer can never exhibit certain patterns of "revealed preference reversals". This model offers clues on the problem of making welfare judgements in the presence of boundedly rational agents. © 2012 by the European Economic Association.