Truth beyond common beliefs – boosting the validity of conjoint-based modelling

It is often argued that people act in an effort to maximise their utility (the classic view of 'homo economicus').

Truth beyond common beliefs – boosting the validity of conjoint-based modelling

Florian BauerVocatus AG, Germany


The deduction of partial utilities within conjoint analyses is based on the assumption that people maximise their utility (“homoeconomicus”). This assumption is contradicted by a broad swathe of empirical findings which have demonstrated that people systematically fail to make rational decisions. They nonetheless make predictable errors, so their decisions essentially remain 'calculable'. Consciously or unconsciously, they simply follow a decision rule that complements utility-maximising choice behaviour.

In a first step, we were able to statistically model this sub-optimal choice behaviour, and in a...

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