On Generalized Secretary Problems

Abstract

This paper is composed of two related parts. In the first, we present a dynamic programming procedure for finding optimal policies for a class of sequential search problems that includes the well-known secretary problem. In the second, we propose a stochastic model of choice behavior for this class of problems and test the model with two extant data sets. We conclude that the previously reported bias for decision makers to terminate their search too early can, in part, be accounted for by a stochastic component of their search policies.

Keywords: Sequential search, secretary problem, decision making, model

JEL Classification: D83, C44, C61