We provide two nested models of random reference-dependent choice in which the
reference point is endogenously determined by random processes. Random choice behavior
is due to random reference points, even though, from the decision-maker’s viewpoint,
choices are deterministic. Through a revealed preference exercise, we establish
when and how one can identify the reference-dependent preferences and the random
reference rule from observed choice data. We also present behavioral postulates that
characterize the empirical content of our models. Lastly, we investigate an application
of our model to Bertrand competition with differentiated product
