Cumulative Discrete Choice

Itzhak Gilboa*, Amit Pazgal

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

9 Scopus citations

Abstract

We present a discrete choice model in which a consumer's impression of each alternative is based on her memory of past experience with this choice, and is stochastically updated whenever the alternative is chosen. The consumer remembers a cumulative utility index per alternative, and, when an alternative is chosen, the index is updated by the addition of a random variable, interpreted as instantaneous utility. We prove that the frequencies of choice converge, with probability 1, to limit frequencies, which can be computed from the model's parameters.

Original languageEnglish
Pages (from-to)119-130
Number of pages12
JournalMarketing Letters
Volume12
Issue number2
DOIs
StatePublished - 2001

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