Choice Rules Can Affect the Informativeness of Model Comparisons

Abstract

AbstractIn cognitive modeling, it is often necessary to complement a core model with a choice rule to derive testable predictions about choice behavior. Researchers can typically choose from a variety of choice rules for a single core model. This article demonstrates that seemingly subtle differences in choice rules’ assumptions about how choice consistency relates to underlying preferences can affect the distinguishability of competing models’ predictions and, as a consequence, the informativeness of model comparisons. This is demonstrated in a series of simulations and model comparisons between two prominent core models of decision making under risk: expected utility theory and cumulative prospect theory. The results show that, all else being equal, and relative to choice rules that assume a constant level of consistency (trembling hand or deterministic), using choice rules that assume that choice consistency depends on strength of preference (logit or probit) to derive predictions can substantially increase the informativeness of model comparisons (measured using Bayes factors). This is because choice rules such as logit and probit make it possible to derive predictions that are more readily distinguishable. Overall, the findings reveal that although they are often regarded as auxiliary assumptions, choice rules can play a crucial role in model comparisons. More generally, the analyses highlight the importance of testing the robustness of inferences in cognitive modeling with respect to seemingly secondary assumptions and show how this can be achieved.