The Luce Model, Regularity, and Choice Overload
Theoretical Economics
2025-03-03 v1
Abstract
We characterize regularity (Block & Marschak, 1960) within a novel stochastic model: the General Threshold Luce model [GTLM]. We apply our results to study choice overload, identified by regularity violations that impose a welfare cost on the decision-maker. Generalizing our characterization results, we identify necessary and sufficient conditions for choice overload within GTLMs and, in doing so, disentangle two well-known causes: low discriminatory power (Frick, 2016) and limited attention (Lleras et al., 2017).
Cite
@article{arxiv.2502.21063,
title = {The Luce Model, Regularity, and Choice Overload},
author = {Daniele Caliari and Henrik Petri},
journal= {arXiv preprint arXiv:2502.21063},
year = {2025}
}