Paradox of choice and consumer nonpurchase behavior

This paper theoretically analyzes the so-called paradox of choice, introduced by Schwartz (The paradox of choice: why more is less, Harper Perennial, New York, 2004), which posits that having too many choices can make us unhappy. Although one's possibilities broaden as the number of choices increases, the paradox of choice occurs because among a greater number of possibilities, making the best choice entails a greater number of complications and incurs higher choice costs. The purpose of this paper is to focus on a specific example of this paradox with respect to consumer nonpurchase behavior, in order to derive the optimal strategy for a firm selling goods or services for consumer purchase. In particular, in constructing a decision-making model by which to ascertain the optimal product quantity (variety) for a firm within the context of the paradox of choice, we can derive the number of product offerings needed to maximize sales. We point out that it is important for a firm to consider nonpurchase behavior. The optimal quantity is inversely proportionate to the consumer's complications and choice costs in making a choice.