Contrasts between utility maximisation and regret minimisation in the presence of opt out alternatives

摘要

An increasing number of studies of choice behaviour are looking at random regretminimisation (RRM) as an alternative to the well established random utilitymaximisation (RUM) framework. Empirical evidence tends to show small differencesin performance between the two approaches, with the implied preference between themodels being dataset specific. In the present paper, we discuss how in the context ofchoice tasks involving an opt out alternative, the differences are likely to be moreclear cut. Specifically, we hypothesise that when opt out alternatives are framed as arejection of all the available alternatives, RUM is likely to outperform RRM, with theopposite being the case when the opt out is framed as a respondent being indifferentbetween the alternatives on offer. We provide empirical strong support for thesehypotheses through two case studies, using the two different types of opt outalternatives. Our findings suggest that analysts need to carefully evaluate their choiceof model structure in the presence of opt out alternatives, while any a prioripreference for a given model structure needs to be taken into account in surveyframing.