The results thus challenge the common assumptions in economic theory about how people choose between differentiated goods. Consequently, this study improves our understanding of consumer decision making and offers important implications for research in marketing, decision science, psychology and economics, and to businesses and managers. Economic models, for example, might yield better predictions if they account for this behavior and not assume that consumers only consider absolute price differences. This is particularly relevant in models dealing with horizontal or vertical differentiation, optimal pricing, competitive strategy, or advertising.