Does attribute cut-off elicitation affect choice consistency? Contrasting hypothetical and real-money choice experiments

The use of threshold values (cut-offs) is a well-recognized simplifying strategy in real life decision-making processes. Recent stated preference studies show that strategies used by respondents in hypothetical settings are consistent with how they normally process information in real markets. Of the different discrete choice models using cut-offs, the Swait (2001) model allows different heuristics to be captured. The few applications of this soft cut-off approach mainly focus on the effects of cut-offs on attribute estimates and willingness to pay, but scant attention has been paid to the consequences of cut-off elicitation. We focussed our investigation on the effects of self-reported cut-offs on choice consistency. In line with studies on context and complexity effects in choice modelling, we parameterize the scale parameter on the basis of two alternative measures related to the stated cut-offs: (1) the number of potential violations included in the choice cards, and (2) the number of cut-offs stated at the most severe level. Moreover, we investigated whether different treatments (hypothetical vs. real-money) affect cut-off elicitations, violations and choice consistency.