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Article
Regret theory and the tyranny of choice
Economic Record (2007)
  • Ben Irons, University of Oxford
  • Cameron J Hepburn, University of Oxford
Abstract

As economists, we tend to accept the principle that more choice cannot make us worse off. However, recent evidence from lab 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.

Keywords
  • regret theory,
  • choice,
  • search
Disciplines
Publication Date
2007
Citation Information
Ben Irons and Cameron J Hepburn. "Regret theory and the tyranny of choice" Economic Record Vol. 83 Iss. 261 (2007)
Available at: http://works.bepress.com/hepburn/3/