Choice Models with a Default/Status-Quo Alternative

Status-Quo-Biased Undominated Choice (Bewley model)

[Bewley, 2002; Mandler, 2004; Masatlioglu and Ok, 2005; Gerasimou, 2016]

A general dataset with default/status quo alternatives \(\mathcal{D}\) is explained by status-quo-biased undominated choice (Bewley model) if there exists a strict partial order \(\succ\) on \(X\) such that for every decision problem \((A,s)\) in \(\mathcal{D}\)

\[\begin{split}\begin{array}{llc} C(A,s)=\{s\} & \Longleftrightarrow & \text{$x\nsucc s$ for all $x\in A$}\\ & &\\ C(A,s)\neq \{s\} &\Longleftrightarrow & C(A,s)= \left\{ \begin{array}{lc} & z\nsucc x\; \text{for all $z\in A$}\\ x\in A: &\text{and}\\ & x\succ s \end{array} \right\} \end{array}\end{split}\]