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Weighted Linear Discrete Choice
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AI
DOI：10.1257/aer.20220130.png)
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Abstract
En 中文
We introduce a new model of stochastic choice that assigns each choice option a utility, along with a salience parameter reflecting economic frictions. We characterize our model behaviorally and investigate its comparative statics properties. We show that the model generates intuitive closed-form solutions in equilibrium settings where firms can choose price, quality, and advertising. In addition, we show that the model allows for flexible substitution patterns and changes in market shares across choice sets. We demonstrate that our model can be easily identified and can outperform alternatives in demand prediction. (JEL D11, D21, D43, M37)
Keywords:
STOCHASTIC CHOICE
VISUAL FIXATIONS
BRAND AWARENESS
SALIENCE
ATTENTION
PRODUCT
DEMAND
RATIONALITY
PREFERENCES
INATTENTION