Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/316901 
Year of Publication: 
2025
Series/Report no.: 
CESifo Working Paper No. 11787
Publisher: 
CESifo GmbH, Munich
Abstract: 
We explore the role of memory for choice behavior in unfamiliar environments. Using a unique data set, we document that decision makers exhibit a "memory premium." They tend to choose in-memory alternatives over out-of-memory ones, even when the latter are objectively better. Consistent with well-established regularities regarding the inner workings of human memory, the memory premium is associative, subject to interference and repetition effects, and decays over time. Even as decision makers gain familiarity with the environment, the memory premium remains economically large. Our results imply that the ease with which past experiences come to mind plays an important role in shaping choice behavior.
Subjects: 
memory
choice behaviour
decision-making
chess960
JEL: 
D01
D87
D91
Document Type: 
Working Paper
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