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Inferring cognitive heterogeneity from aggregate choices

journal contribution
posted on 2023-06-09, 20:36 authored by Valentino Dardanoni, Paola Manzini, Marco Mariotti, Christopher J Tyson
Theories of bounded rationality often assume a rich dataset of choices from many overlapping menus, limiting their practical applicability. In contrast, we study the problem of identifying the distribution of cognitive characteristics in a population of agents from a minimal dataset that consists of aggregate choice shares from a single menu, and includes no observable covariates of any kind. With homogeneous preferences, we find that “consideration capacity” and “consideration probability” distributions can both be recovered effectively if the menu is sufficiently large. This remains true generically when tastes are heterogeneous with a known distribution. When the taste distribution is unknown, we show that joint choice share data from three “occasions” are generically sufficient for full identification of the cognitive distribution, and also provide substantial information about tastes.

History

Publication status

  • Published

File Version

  • Accepted version

Journal

Econometrica

ISSN

0012-9682

Publisher

Econometric Society

Issue

3

Volume

88

Page range

1269-1296

Department affiliated with

  • Economics Publications

Full text available

  • Yes

Peer reviewed?

  • Yes

Legacy Posted Date

2020-02-19

First Open Access (FOA) Date

2020-05-22

First Compliant Deposit (FCD) Date

2020-02-13

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