STRATEGIES OF SEARCH

Two experiments are designed to examine the strategies people use in s earch behavior. In the first experiment an electronic information boar d is used to register on which aspects of the situation subjects focus their attention and after that subjects also submit a formal strategy . Although efficiency is rather high, most subjects do not use the the oretical optimal strategy. Many subjects seem to focus on the total ea rnings instead of the marginal return of another draw. On an average, subjects stop searching too early. This cannot totally be explained by risk aversion. The second experiment shows that the tendency to searc h too Little can be (partly) explained by learning processes. (C) 1998 Elsevier Science B.V.