Understanding the distribution and the determinants of search criteria thresholds helps in representing choice set formation and choice behavior. The development and estimation are presented of a two-stage model that jointly represents search criteria thresholds, within a noncompensatory choice set formation stage, and choice behavior, within a compensatory stage. Data were collected by using a custom-designed web-based choice experiment that seamlessly tracked the entire choice process by recording choice protocols. The model is applied to off-campus rental apartment choice by students as an example of a complex choice situation. The model combines three correlated ordered response models for the search criteria with a multinomial logit model for the choice among a realistically large realm of 200 alternatives. Estimates demonstrate that (a) the thresholds are correlated and their selection can be explained by individual characteristics, preferences, and perceptions and (b) the suggested methodology alleviates the computational complexity embedded in two-stage models by reducing the number of theoretically possible choice sets to the actually chosen ones.
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