Odds supermodularity and the Luce rule

We present a characterization of the Luce rule in terms of positivity and a new choice axiom called odds supermodularity that strengthens the regularity axiom. This new characterization illuminates a connection that goes unnoticed, and sheds light on the behavioral underpinnings of the Luce rule and...

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Bibliographic Details
Published in:	Games and economic behavior Vol. 126; pp. 443 - 452
Main Authors:	Doğan, Serhat, Yıldız, Kemal
Format:	Journal Article
Language:	English
Published:	Elsevier Inc 01-03-2021
Subjects:	Luce rule Random choice Stochastic path independence Supermodularity Zero probability choices Random choice D01 Luce rule Supermodularity Stochastic path independence D07 D09 Zero probability choices
Online Access:	Get full text
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Summary:	We present a characterization of the Luce rule in terms of positivity and a new choice axiom called odds supermodularity that strengthens the regularity axiom. This new characterization illuminates a connection that goes unnoticed, and sheds light on the behavioral underpinnings of the Luce rule and its extensions from a different perspective. We show that odds supermodularity per se characterizes a structured extension of the Luce rule that accommodates zero probability choices. We identify the random choice model characterized via a stochastic counterpart of Plott (1973)'s path independence axiom, which strengthens odds supermodularity.
ISSN:	0899-8256 1090-2473
DOI:	10.1016/j.geb.2021.01.008