Normalization is a general neural mechanism for context-dependent decision making.

Understanding the neural code is critical to linking brain and behavior. In sensory systems, divisive normalization seems to be a canonical neural computation, observed in areas ranging from retina to cortex and mediating processes including contrast adaptation, surround suppression, visual attention, and multisensory integration. Recent electrophysiological studies have extended these insights beyond the sensory domain, demonstrating an analogous algorithm for the value signals that guide decision making, but the effects of normalization on choice behavior are unknown. Here, we show that choice models using normalization generate significant (and classically irrational) choice phenomena driven by either the value or number of alternative options. In value-guided choice experiments, both monkey and human choosers show novel context-dependent behavior consistent with normalization. These findings suggest that the neural mechanism of value coding critically influences stochastic choice behavior and provide a generalizable quantitative framework for examining context effects in decision making.