D. Butler et G. Loomes, QUASI-RATIONAL SEARCH UNDER INCOMPLETE INFORMATION - SOME EVIDENCE FROM EXPERIMENTS, Manchester School of Economic and Social Studies, 65(2), 1997, pp. 127-144
This paper presents an aspiration-satisficing model of consumer search
under limited information where no optimal strategy is defined. The m
odel is contrasted with the Hey (Journal of Economic Behaviour and Org
anization (1982), Vol. 3, No. 1, pp. 65-81; (1987), Vol. 8, No. 2, pp.
137-144) ''bounce rules''. Experimental evidence is presented which,
in this environment, lends support for the former explanation over the
latter. In particular, the order in which price quotes were received
was not accorded significance. These contrasting results suggest that
subjects may utilize rules of varying degrees of sophistication depend
ing on the costs and expected benefits attached to their use in differ
ent informational environments. A simpler version of the aspiration-sa
tisficing model is then developed that produces an ''order effect''.