Hirmas, A., Engelmann, J. and van der Weele, J. (2024). Individual and Contextual Effects of Attention in Risky Choice Experimental Economics, 27(5):1211--1238.

We investigate the role of visual attention in risky choice in a rich experimental dataset that includes eye-tracking data. We first show that attention is not reducible to individual and contextual variables, which explain only 20% of attentional variation. We then decompose attentional variation into individual average attention and trial-wise deviations of attention to capture different cognitive processes. Individual average attention varies by individual, and can proxy for individual preferences or goals (as in models of {\textquotedblleft}rational inattention{\textquotedblright} or goal-directed attention). Trial-wise deviations of attention vary within subjects and depend on contextual factors (as in models of {\textquotedblleft}salience{\textquotedblright} or stimulus-driven attention). We find that both types of attention predict behavior: average individual attention patterns are correlated with individual levels of loss aversion and capture part of this individual heterogeneity. Adding trial-wise deviations of attention further improves model fit. Our results show that a decomposition of attention into individual average attention and trial-wise deviations of attention can capture separable cognitive components of decision making and provides a useful tool for economists and researchers from related fields interested in decision-making and attention.