This paper overviews three primary branches of the industrial organization literature with
behavioral consumers. The literature is organized according to whether consumers:(1) have …

Individuals must often choose among discrete actions with imperfect information about their
payoffs. Before choosing, they have an opportunity to study the payoffs, but doing so is …

We integrate tools to monitor information acquisition in field experiments on discrimination
and examine whether gaps arise already when decision makers choose the effort level for …

We present a model of market competition in which consumers' attention is drawn to the
products' most salient attributes. Firms compete for consumer attention via their choices of …

This paper develops a theory for the expected cost of optimally acquired information when
information can be acquired sequentially. We study the “reduced-form” Indirect Cost …

Both the “law of one price” and Bertrand's (J Savants 67: 499–508, 1883) prediction of
marginal cost pricing for homogeneous goods rest on the assumption that consumers will …

A recent growing body of studies shows that many important phenomena in economics are,
or can be, driven by the fact that humans cannot digest all available information, but they can …

Using a standard strategic pricing game, I determine how sellers set prices when facing
buyers who are “rationally inattentive” to information about product quality. Two cases are …

A seller bargains with a rationally inattentive buyer (Sims 2003) over a good of random
quality. After observing quality, the seller makes a take-it-or-leave-it offer. The buyer pays …

This paper proposes a mechanism leading to rigid pricing as an optimal strategy. It applies a
framework of rational inattention to study the pricing strategies of a monopolistic seller facing …