Looking for Salience: Eye-tracking and Preference Reversals

Andreas Gotfredsen; Edward J. D. Webb; Carsten S. Nielsen; Alexander C. Sebald

Looking for Salience: Eye-tracking and Preference Reversals

Andreas Gotfredsen
, Edward J. D. Webb
, Carsten S. Nielsen
, Alexander C. Sebald

University of Copenhagen

Research output: Working paper › Research

Abstract

The results of an eye-tracking experiment designed to study a violation of revealed preference predicted by salience theory are reported. Specifically, individuals will choose a low quality good with a low price level and a high quality good with a high price level, despite the price of the quality premium being held constant. Subjects exhibited a significant numbers of such preference reversals (16.12% of decisions). However, the eye-tracking hypotheses, designed to test the underlying mechanism of salience theory, are all rejected. The implications for salience theory are discussed. More reversals were observed with hypothetical than incentivized choice (22.11% vs. 10.12% of decisions).

Original language	English
Place of Publication	Copenhagen
Publisher	Department of Economics. University of Copenhagen
Number of pages	33
Publication status	Published - 2015
Externally published	Yes

Bibliographical note

Published in: Webb, Edward John Dorrell (2016) : Attention and perception in decisionmaking and interactions, PhD Series, No. 181, ISBN 978-87-93428-04-1, University of Copenhagen, Department of Economics, Copenhagen.

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Cite this

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abstract = "The results of an eye-tracking experiment designed to study a violation of revealed preference predicted by salience theory are reported. Specifically, individuals will choose a low quality good with a low price level and a high quality good with a high price level, despite the price of the quality premium being held constant. Subjects exhibited a significant numbers of such preference reversals (16.12\% of decisions). However, the eye-tracking hypotheses, designed to test the underlying mechanism of salience theory, are all rejected. The implications for salience theory are discussed. More reversals were observed with hypothetical than incentivized choice (22.11\% vs. 10.12\% of decisions).",

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N2 - The results of an eye-tracking experiment designed to study a violation of revealed preference predicted by salience theory are reported. Specifically, individuals will choose a low quality good with a low price level and a high quality good with a high price level, despite the price of the quality premium being held constant. Subjects exhibited a significant numbers of such preference reversals (16.12% of decisions). However, the eye-tracking hypotheses, designed to test the underlying mechanism of salience theory, are all rejected. The implications for salience theory are discussed. More reversals were observed with hypothetical than incentivized choice (22.11% vs. 10.12% of decisions).

AB - The results of an eye-tracking experiment designed to study a violation of revealed preference predicted by salience theory are reported. Specifically, individuals will choose a low quality good with a low price level and a high quality good with a high price level, despite the price of the quality premium being held constant. Subjects exhibited a significant numbers of such preference reversals (16.12% of decisions). However, the eye-tracking hypotheses, designed to test the underlying mechanism of salience theory, are all rejected. The implications for salience theory are discussed. More reversals were observed with hypothetical than incentivized choice (22.11% vs. 10.12% of decisions).

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