Evaluating opportunities when more is less
Tóm tắt
There exists psychological evidence that consumers do not consider all available items in the market, which can lead to the “more-is-less” effect, a phenomenon where having more options causes a welfare reduction (Llears et al. in J Econ Theory 170:70–85, 2017). Under this more-is-less effect, we face a dilemma that adding new opportunities may both improve and worsen individual well-being. This study proposes a hypothesis that “more is always better,” which implies that adding new opportunities cannot worsen individual well-being, is a bias to which moral heuristics leads. A satisfactory resolution of this dilemma is act-consequentialism over menus, which is an ex-post and third-party evaluation of opportunity sets. We provide an axiomatic foundation for act-consequentialism over menus and apply it to policymakers’ menu-providing policies.
Tài liệu tham khảo
Aoki, R., Matsumoto, M., Yomogida, Y., Izuma, K., Murayama, K., Sugiura, A., et al. (2014). Social equality in the number of choice options is represented in the ventromedial prefrontal cortex. Journal of Neuroscience, 34, 6413–6421.
Arneson, R. J. (1989). Equality and equal opportunity for welfare. Philosophical Studies, 56, 77–93.
Arneson, R. J. (1999). Debate: Equality of opportunity for welfare defended and recanted. Journal of Political Philosophy, 7, 488–497.
Arrow, K. J. (1995). A note on freedom and flexibility. In K. Basu, P. K. Pattanaik, & K. Suzumura (Eds.), Choice, welfare and development, a festschrift in honor of Amartya K Sen (pp. 7–16). Oxford University Press.
Barberà, S., Bossert, W., & Pattanaik, P. K. (2004). Ranking sets of objects. In S. Barberà, P. Hammond, & C. Seidl (Eds.), Handbook of utility theory: Extensions (Vol. 2, pp. 893–977). Kluwer Academic Publishers.
Baron, J. (1994). Nonconsequentialist decisions. Behavioral and Brain Sciences, 17, 1–42.
Bossert, W. (1997). Opportunity sets and individual well-being. Social Choice and Welfare, 14, 97–112.
Botti, S., & Hsee, C. K. (2010). Dazed and confused by choice: How the temporal costs of choice freedom lead to undesirable outcomes. Organizational Behavior and Human Decision Processes, 112, 161–171.
Botti, S., & Iyengar, S. S. (2006). The dark side of choice: When choice impairs social welfare. Journal of Public Policy and Marketing, 25, 24–38.
Buturak, G., & Evren, Ö. (2017). Choice overload and asymmetric regret. Theoretical Economics, 12, 1029–1056.
Cherepanov, V., Feddersen, T., & Sandroni, A. (2013). Rationalization. Theoretical Economics, 8, 775–800.
de Clippel, G., & Rozen, K. (2021). Bounded rationality and limited data sets. Theoretical Economics, 16, 359–380.
Dworkin, G. (1982). Is more choice better than less? In P. A. French, T. E. Uehling Jr., & H. K. Wettstein (Eds.), Midwest studies in philosophy (Vol. VII, pp. 47–61). University of Minnesota Press.
Fleurbaey, M. (2012). The importance of what people care about. Politics, Philosophy & Economics, 11, 415–447.
Fujiwara, J., Usui, N., Park, S. Q., Williams, T., Iijima, T., Taira, M., et al. (2013). Value of freedom to choose encoded by the human brain. Journal of Neurophysiology, 110, 1915–1929.
Gaertner, W. (1993). Amartya Sen: Capability and well-being. In M. Nussbaum & A. K. Sen (Eds.), The Quality of Life (pp. 62–66). Oxford University Press.
Gravel, N. (1998). Ranking opportunity sets on the basis of their freedom of choice and their ability to satisfy preferences: A difficulty. Social Choice and Welfare, 15, 371–382.
Gustafsson, J. E. (2020). A paradox for the intrinsic value of freedom of choice. Noûs, 54, 891–913.
Iyengar, S. S., & Lepper, M. R. (2000). When choice is demotivating: Can one desire too much of a good thing? Journal of Personality and Social Psychology, 79, 995–1006.
Jones, P., & Sugden, R. (1982). Evaluating choice. International Review of Law and Economics, 2, 47–65.
Klemisch-Ahlert, M. (1993). Freedom of choice: A comparison of different rankings of opportunity sets. Social Choice and Welfare, 10, 189–207.
Kreps, D. M. (1979). A representation theorem for “preference for flexibility’’. Econometrica, 47, 565–577.
Leotti, L. A., & Delgado, M. R. (2011). The inherent reward of choice. Psychological Science, 22, 1310–1318.
Lleras, J. S., Masatlioglu, Y., Nakajima, D., & Ozbay, E. (2017). When more is less: Limited consideration. Journal of Economic Theory, 170, 70–85.
Manzini, P., & Mariotti, M. (2007). Sequentially rationalizable choice. American Economic Review, 97, 1824–1839.
Manzini, P., & Mariotti, M. (2012). Categorize then choose: Boundedly rational choice and welfare. Journal of the European Economic Association, 10, 1141–1165.
Masatlioglu, Y., Nakajima, D., & Ozbay, E. Y. (2012). Revealed attention. American Economic Review, 102, 2183–2205.
Nehring, K., & Puppe, C. (1999). On the multi-preference approach to evaluating opportunities. Social Choice and Welfare, 16, 41–63.
Pattanaik, P. K., & Xu, Y. (1998). On preference and freedom. Theory and Decision, 44, 173–198.
Puppe, C. (1995). Freedom of choice and rational decisions. Social Choice and Welfare, 12, 137–153.
Puppe, C. (1996). An axiomatic approach to “preference for freedom of choice’’. Journal of Economic Theory, 68, 174–199.
Reutskaja, E., Lindner, A., Nagel, R., Andersen, R. A., & Camerer, C. F. (2018). Choice overload reduces neural signatures of choice set value in dorsal striatum and anterior cingulate cortex. Nature Human Behavior, 2, 925–935.
Reutskaja, E., Nagel, R., Camerer, C. F., & Rangel, A. (2011). Search dynamics in consumer choice under time pressure: An eye-tracking study. American Economic Review, 101, 900–926.
Rubinstein, A., & Salant, Y. (2006). A model of choice from lists. Theoretical Economics, 1, 3–17.
Sarver, T. (2008). Anticipating regret: Why fewer options may be better. Econometrica, 76, 263–305.
Schwartz, B. (2004). The Paradox of Choice: Why More Is Less. HarperCollins Publishers Inc.
Schwartz, B., & Ward, A. (2004). Doing better but feeling worse: The paradox of choice. In P. A. Linley & S. Joseph (Eds.), Positive psychology in practice (pp. 86–104). Wiley.
Sen, A. K. (1979). Utilitarianism and welfarism. Journal of Philosophy, 76, 463–489.
Sen, A. K. (1985). Commodities and Capabilities. North-Holland.
Sen, A. K. (1988). Freedom of choice: Concept and content. European Economic Review, 32, 269–294.
Sen, A. K. (1991). Welfare, preference and freedom. Journal of Econometrics, 50, 15–29.
Sen, A. K. (2002). Rationality and freedom. Belknap Press.
Shin, J., & Ariely, D. (2004). Keeping doors open: The effect of unavailability on incentives to keep options viable. Management Science, 50, 575–586.
Sugden, R. (2003). Opportunity as a space for individuality: Its value and the impossibility of measuring it. Ethics, 113, 783–809.
Sunstein, C. R. (2005). Moral heuristics. Behavioral and Brain Sciences, 28, 531–573.
Suzumura, K. (1976). Remarks on the theory of collective choice. Economica, 43, 381–390.
Suzumura, K., & Xu, Y. (2001). Characterizations of consequentialism and nonconsequentialism. Journal of Economic Theory, 101, 423–436.
Tversky, A., & Kahneman, D. (1974). Judgment under uncertainty: Heuristics and biases. Science, 185, 1124–1131.