Chapter 1: In many settings, it is natural to think of limited consideration

exhibiting spillovers: attention paid to a particular alternative may “spill over” to

another alternative based on shared characteristics, complementarities, features of

the choice environment, etc. However, it is not straightforward whether, given choice

data, a) preferences among alternatives can be revealed, or b) the network of consideration spillovers can be revealed. Using a novel laboratory experiment, I test a

deterministic Network Choice model proposed in previous work and find a plethora

of violations thereof, even at the individual level. I then propose a stochastic model,

Random Network Choice, and analyze its properties regarding the formation of consideration sets. When applied to the laboratory data, I find considerable consistency

with the general Random Network Choice model. Armed with a model of network

choice consistent with my experimental data, I consider one application in the realm

of advertising to show that such a generalization of so-called “positive spillovers” in

attention is necessary to avoid misleading welfare analysis.

Chapter 2: This paper experimentally investigates the effect of introducing un-

available alternatives and irrelevant information regarding the alternatives on the

optimality of decisions in choice problems. We find that interaction between the

unavailable alternatives and irrelevant information regarding the alternatives generates suboptimal decisions. Irrelevant information in any dimension increases the

time costs of decisions. We also identify a pure “preference for simplicity” beyond

the desire to make optimal decisions or minimize time spent on a decision problem.

Our results imply that the presentation set, distinct from the alternative set, needs

to be a part of decision making models.

Chapter 3: To what extent does positive reciprocity extent to environments with

uncertainty? In order to answer this question, we propose a new game, the Stochastic Gift Exchange game (SGE), that extends the standard sequential deterministic

Gift Exchange game (DGE) into an environment with uncertainty. SGE shares

the unique subgame perfect Nash equilibrium with DGE wherein no players trade,

leading to a suboptimal ex-ante allocation. However, contrary to DGE, leading

models of reciprocity do not predict departures from this equilibrium in the direction of positive giving. When we conduct SGE in a laboratory experiment, we find

positive Wages and Effort, indicating the presence of an ex-ante reciprocal motive.

Moreover, Wages are lower in SGE than in DGE, indicating both that ex-post reciprocal motives also matter and that laboratory studies of gift exchange, which have

been exclusively conducted with DGE, may overestimate the amount of positive

reciprocity in the real world. Finally, we conduct two alterations of the SGE to

investigate to what extent the source of uncertainty matters for reciprocal giving.

Results from these treatments indicate that a) the source of uncertainty does not

matter for Wage and Effort determination, but that b) there is evidence of an endowment effect in the ex-ante vs ex-post fairness domains. When endowed with the

ability to affect the ex-ante (ex-post) allocation, ex-ante (ex-post) reciprocal motives

dominate. Such a phenomenon runs contrary to the additive separability of ex-ante

and ex-post motives, a common assumption in leading models that incorporate both

risk and social preferences. Our results suggest new directions for future theoretical

explorations of ex-ante reciprocity.