Optimal Selection From a Set of Offers Using a Short List

The rise of the Internet has led to a huge amount of information being available at the touch of a button. This article presents a model of searching for a valuable good, e.g. a new flat, using the Internet to gain initial information about the offers available. This information is used to create a short list of offers to be observed more closely before making a final decision. Although there has been a lot of recent work on the use of short lists in decision making procedures, there has been very little work on how the length of a short list should depend on the parameters of the search problem. This article addresses this problem and gives results on the optimal length of a short list when a searcher is to choose one of n offers and the search costs are convex in the length of the short list. Several examples are considered.