How to Extend a Model of Probabilistic Choice from Binary Choices to Choices Among More than Two Alternatives

Institute for Empirical Research in Economics University of Zurich Working Paper Series

10 Pages Posted: 4 Sep 2009

Date Written: September 3, 2009

Abstract

This note presents an algorithm that extends a binary choice model to choice among multiple alternatives. Both neoclassical microeconomic theory and Luce choice model are consistent with the proposed algorithm. The algorithm is compatible with several empirical findings (asymmetric dominance and attraction effects) that cannot be explained within standard models.

Keywords: probabilistic choice, binary choice, multiple alternatives

JEL Classification: C44, D11, D7, D81

Suggested Citation

Blavatskyy, Pavlo R., How to Extend a Model of Probabilistic Choice from Binary Choices to Choices Among More than Two Alternatives (September 3, 2009). Institute for Empirical Research in Economics University of Zurich Working Paper Series, Available at SSRN: https://ssrn.com/abstract=1467605 or http://dx.doi.org/10.2139/ssrn.1467605

Pavlo R. Blavatskyy (Contact Author)

Montpellier Business School ( email )

2300 Avenue des Moulins
Montpellier, 34080
France

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