Unifying Procedure-Dependent Preference Reversals: Theory and Experiments

• 成果类型: Article
• 署名作者: Guo, Liang
• 署名单位: City University of Hong Kong
• 刊物名称: MANAGEMENT SCIENCE
• ISSN/ISSBN: 0025-1909
• DOI: 10.1287/mnsc.2021.02640
• 发表日期: 2024
• 关键词: Deliberation; evaluation mode; evaluation scale; Preference reversal; Procedure invariance; prominence effect; joint evaluation

摘要

Revealed preferences between alternatives can be systematically reversed across a variety of elicitation procedures (e.g., choice, valuation, matching, joint/separate evaluation). These puzzling findings have been usually invoked to challenge the procedure invariance principle. Yet procedure -dependent preferences can be endogenous. This paper presents a unifying theory of contextual deliberation to account for seemingly disparate phenomena of preference reversals. When attribute importance is ex ante imperfectly known, people can engage in costly information retrieval/acquisition activities (i.e., deliberation) prior to making decisions. Elicitation procedures can influence revealed preferences through affecting the incentive for deliberation. Therefore, contextual deliberation can endogenously yield procedure -dependent preference reversals, offer a common microfoundation for extant psychological accounts (e.g., the prominence hypothesis, the evaluability hypothesis), and coherently organize apparently unrelated/inconsistent findings in the literature. We also run five experiments and document new findings that are inconsistent with extant hypotheses but can be reconciled by contextual deliberation.