Heuristic decision making in network linking
We explore individual linking decisions in a network context by an incentivized laboratory experiment with mixed logit analysis. The inherent complexity of this context results in two heuristic effects with substantial implications for OR models of network formation. Individuals choices are systematically less guided by payoff but more by simpler heuristic decision cues. This shift from payoff to heuristic cues is systematically stronger for social payoff than for own payoff. The specific between-subject complexity factors value transferability and social tradeoff aggravate the former effect.
laboratory experiment mixed logit heuristic effects network formation individual decision making