Recall in consumer search

Abstract This paper experimentally examines individual decision making in a sequential search environment. When consumers sequentially search for the lowest price from a known distribution of prices, theory suggests that decisions will be based on a comparison of the marginal cost of an additional search and the expected return from that search. Additionally, in a finite time horizon model, it is possible that individuals may choose to return to a price previously rejected (exercise recall). The data are used to determine if individuals do exercise recall, the extent to which that option is chosen, and to determine if the use of recall is dependent on the cost of search.