Information search is key to making decision from experience: exploration permits people to learn about the statistical properties of choice options and thus to become aware of rare but potentially momentous decision consequences. This registered report investigates whether and how people differ when making decisions from experience in isolation versus under competitive pressure, which may have important implications for choice performance in different types of choice environments: in “kind” environments without any rare and extreme events, frugal search is sufficient to identify advantageous options. Conversely, in “wicked” environments with skewed outcome distributions, rare but important events will tend to be missed in frugal search. One theoretical view is that competitive pressure encourages efficiency and may thereby boost adaptive search in different environments. An alternative and more pessimistic view is that competitive pressure triggers agency-related concerns, leading to minimal search irrespective of the choice environment, and hence to inferior choice performance. Using a sampling game, the present study (N = 277) found that solitary search was not adaptive to different choice environments (M = 14 samples), leading to a high choice performance in a kind and in a moderately wicked environment, but somewhat lower performance in an extremely wicked environment. Competitive pressure substantially reduced search irrespective of the choice environment (M = 4 samples), thus negatively affecting overall choice performance. Yet, from the perspective of a cost-benefit framework, frugal search may be efficient under competitive pressure. In sum, this report extends research on decisions from experience by adopting an ecological perspective (i.e., systematically varying different choice environments) and by introducing a cost-benefit framework to evaluate solitary and competitive search — with the latter constituting a challenging problem for people in an increasingly connected world.

I embed a competitive search model of the labor market into a small open economy model with heterogeneous firms and workers. Search frictions generate equilibrium unemployment and income inequality between identical workers, in addition to income differences between skill groups. A quantitative evaluation of the U.S. trade experience suggests that the effect of the increase in goods trade since 1980 may have contributed to the increase in the college premium, but not to the increase in residual inequality.

Rocheteau, Rupert, and Wright [Scandinavian Journal of Economics 109 (2007), 837–855] show that the relationship between inflation and unemployment can be positive or negative, depending on the primitives of the model. The key features are indivisible labor, nonseparable preferences, and bargaining. Their results are derived only for a special case of bargaining, take-it-or-leave-it offer by buyers. Instead of bargaining, this paper considers competitive search. I show that the results of Rocheteau et al. can be generalized to an environment where both buyers and sellers have nonseparable preferences. In addition, the relationship between inflation and unemployment is robust to allowing free entry by sellers, which cannot be studied in Rocheteau et al. (2007).