Skip to main content
Article thumbnail
Location of Repository

Regret theory and the tyranny of choice

By Ben Irons and Cameron Hepburn

Abstract

As economists, we tend to accept the principle that more choice cannot make us worse off. However, recent evidence from laboratory and field experiments suggests that more choice can inhibit decision-making and reduce search in many situations, potentially reducing welfare. This paper provides a formal theoretical foundation for these observations by embedding the regret theory of Loomes and Sugden (1982) in three search models. Beyond a threshold number of options, we find that ‘less is more’: agents who experience regret have lower utility as the number of options is increased

Topics: HB Economic Theory
Publisher: Wiley-Blackwell on behalf of The Economic Society of Australia
Year: 2007
DOI identifier: 10.1111/j.1475-4932.2007.00393.x
OAI identifier: oai:eprints.lse.ac.uk:32944
Provided by: LSE Research Online
Download PDF:
Sorry, we are unable to provide the full text but you may find it at the following location(s):
  • http://www.wiley.com/bw/journa... (external link)
  • http://eprints.lse.ac.uk/32944... (external link)
  • Suggested articles


    To submit an update or takedown request for this paper, please submit an Update/Correction/Removal Request.