Mental Budgeting versus Relative Thinking
- (pp. 148-52)
Abstract
In many situations, mental budgeting and relative thinking predict results that are in opposing directions. We study a situation of this type and provide evidence for when the predictions of one model will dominate the other.Citation
Hirshman, Samuel, Devin Pope, and Jihong Song. 2018. "Mental Budgeting versus Relative Thinking." AEA Papers and Proceedings, 108: 148-52. DOI: 10.1257/pandp.20181095Additional Materials
JEL Classification
- D12 Consumer Economics: Empirical Analysis
- D91 Micro-Based Behavioral Economics: Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making