Ordinal Relative Satisficing Behavior

NEME ALEJANDRO

Santiago.

Conferencia; Conferencia Científica; 2016

Departamento de Ingenieria Industrial, Universidad de Chile

We propose a notion of r-rationality, a relative version of satisficing behavior based on the idea that, for any set of available alternatives, individuals choose one of their r-best according to a single preference order. We fully characterize the choice functions satisfying the condition for any r, and provide an algorithm to compute the maximal degree of r-rationality associated with any given choice function. The notion is extended to individuals whose r may vary with the set of available alternatives. Special cases of ordinal relative satisficing behavior result from a variety of choice models proposed in the literature. We provide experimental evidence that the predictive power of our theory, as measured by Selten's index, improves upon that of alternative ones.