Replication data for: Memory and Reference Prices: An Application to Rental Choice
- Bordalo, Pedro
- Gennaioli, Nicola
- Shleifer, Andrei
AbstractLoewenstein and Simonsohn (2006) found that movers across US cities anchor their rental choices to rents in the city of origin, but subsequently converge to comparable local households. We explain this finding using the authors' (2019) model of memory and attention. Rents in the destination city cue recall of "normal" rents in the city of origin, making the former surprisingly high or low, causing movers to under- or overspend, respectively. Over time, experience with new city rents allows the memory database to adapt, and the effect fades away. The model yields two new predictions, for which we find supportive evidence.
Is supplement to
DOI: 10.1257/pandp.20191052 (Text)
Bordalo, Pedro, Nicola Gennaioli, and Andrei Shleifer. “Memory and Reference Prices: An Application to Rental Choice.” AEA Papers and Proceedings 109 (May 2019): 572–76. https://doi.org/10.1257/pandp.20191052.
- ID: 10.1257/pandp.20191052 (DOI)
Update Metadata: 2020-05-18 | Issue Number: 2 | Registration Date: 2019-12-07