Related papers: Consumer Behavior under Benevolent Price Discrimin…
This paper investigates whether climate-friendly food products command a price premium in consumer markets. Using product-level data from a supermarket in Sweden, we examine the relationship between front-of-package climate impact scores…
As a firm varies the price of a product, consumers exhibit reference effects, making purchase decisions based not only on the prevailing price but also the product's price history. We consider the problem of learning such behavioral…
Interference between treated and untreated units is a source of bias in marketplace experiments. In this paper, we specifically consider pricing interventions, in which a platform seeks to adjust base pricing levels at the marketplace level…
Consumers only discover at the first seller which product best fits their needs, then check its price online, then decide on buying. Switching sellers is costly. Equilibrium prices fall in the switching cost, eventually to the monopoly…
When customers must visit a seller to learn the valuation of its product, sellers potentially benefit from charging a lower price on the first visit and a higher price when a buyer returns. Armstrong and Zhou (2016) show that such price…
The process of consumer decision-making is multidimensional, and price perception is a very important but still not well-understood dimension for both marketers and consumers. Although heuristics or mental shortcuts are seen as biased and…
Many important economic outcomes result from the combined effects of several choices, so the best option is not determined from each choice in isolation, but depends on how each choice alters total outcomes. We formally show that narrow…
When decision makers evaluate a sequence of rewards, they may pay more attention to larger rewards and, given attention is limited, less attention to smaller rewards. They may also become less attentive to each reward when attention is…
Our society can benefit immensely from algorithmic decision-making and similar types of artificial intelligence. But algorithmic decision-making can also have discriminatory effects. This paper examines that problem, using online price…
A seller is pricing identical copies of a good to a stream of unit-demand buyers. Each buyer has a value on the good as his private information. The seller only knows the empirical value distribution of the buyer population and chooses the…
In the current landscape of ever-increasing levels of digitalization, we are facing major challenges pertaining to scalability. Recommender systems have become irreplaceable both for helping users navigate the increasing amounts of data…
We present the results of a study designed to measure the impact of interruptive advertising on consumers willingness to pay for products bearing the advertiser's brand. Subjects participating in a controlled experiment were exposed to ads…
As the sociological theory of homophily suggests, people tend to interact with those of similar preferences. Motivated by this well-established phenomenon, today's online sellers, such as Amazon,~seek~to learn a new buyer's private…
A monopolist offers personalized prices to consumers with unit demand, heterogeneous values, and idiosyncratic costs, who differ in a protected characteristic, such as race or gender. The seller is subject to a non-discrimination…
We study how a monopolist's use of consumer data for price discrimination affects welfare. To answer this question, we develop a model of market segmentation subject to residual uncertainty. We fully characterize when data usage…
This paper investigates third-degree price discrimination under endogenous market segmentation. Segmenting a market requires access to information about consumers, and this information comes with a cost. I explore the trade-offs between the…
This article examines the effect of different other-regarding preference types on the emergence of altruistic punishment behavior from an evolutionary perspective. Our findings corroborate, complement, and interlink the experimental and…
Much like small ripples in a stream, which get lost in the larger waves, small changes in retail prices often fly under the radar of public perceptions, while large price changes appear as marketing moves associated with demand and…
We study how market segmentation affects consumers when a monopolist can adjust both prices and product qualities across segments, engaging in second- and third-degree price discrimination simultaneously. We characterize the…
Recommender systems are known to suffer from the popularity bias problem: popular (i.e. frequently rated) items get a lot of exposure while less popular ones are under-represented in the recommendations. Research in this area has been…