Set-Size Effects and the Neural Representation of Value

This chapter lays out a framework for understanding choice set effects among organisms at the neural level that may reconcile many previous unrelated observations about set-size effects. The decision process is vital to organisms that live in a dynamic environment and require a behavioral repertoire beyond simple stimulus-response reflexes. Individuals hold stable rank-ordered preferences between all possible options—a requirement for any form of efficient maximization. Under this assumption, enlarging the choice set can only increase the likelihood of obtaining a better option according to the chooser's preexisting preferences. Choice set-size effects are a specific example of the broader phenomenon of context-dependent preferences and choice behavior, situations in which the term context refers to the other alternatives available in the choice set. Since value information is a fundamental element of the decision process, it is important to understand how set-size manipulation affects the neural representation of value. Economic theories do not require that value be represented in specific.