CentER

Bernard Conlon

Abstract:
The dissertation concentrates on consumer choice and the ability of current modelling approaches to capture the underlying behaviour of the individual decision-makers. The standard assumption of a rational utility maximising individual and its implications for observed behaviour are examined and demonstrated empirically to be incompatible with actual consumer choices. In particular the complexity of the choice situation, and its various components, are found to be major determinants of the choice outcomes. Both the accuracy of the choice outcome and as well as the process leading to the decision are found to vary with the difficulty of the choice set. Framing effects are also seen to lead individuals to indicate different preferences depending on the setting of the decision task. Models that allow for these deviations from the behaviour predicted under standard modelling assumptions are developed and the implementation of such models is discussed and illustrated utilising two major consumer surveys for the Dutch population.