New method reveals welfare impact of irrational choices, changing decision-making paradigms.
The article presents a new method to measure the well-being of decision makers based on their choices, even if those choices are not always rational. Instead of assuming one clear preference, the method considers that decisions can be influenced by multiple conflicting preferences. By analyzing these conflicting preferences, the method can estimate the decision maker's welfare and set boundaries on potential changes. The research shows that even irrational decision makers can follow some patterns of rational choice theory, and the method can help understand different choice behaviors seen in psychological experiments.