Aspiration formation and satisficing in isolated and competitive search

We experimentally explore individual and interactive decision making in a sequential search task and test whether generally accepted principles of bounded rationality (aspiration formation, satisficing, and aspiration adjust- ment) adequately explain the observed search behavior. Subjects can, at a cost, employ screening and selection methods facilitating their search and re- vealing their aspirations. The majority of subjects seems to follow the single threshold heuristic after extensive experimentation. Contrary to popular the- ories of sequential search, aspiration levels are set below the maximum value of all previously inspected alternatives. In a competitive search subjects tend to experiment less before engaging in satisficing and generally state lower aspi- rations. Finally, systematic satisficing seems to significantly enhance payoffs.