pricing strategy of firms. Educating consumers may do more harm than good and should thus only be considered if the regulator …

environment with a few simple, realistic ingredients and demonstrate that using an asking price is optimal: it is the pricing … characterization of this equilibrium and use it to explore the positive implications of this pricing mechanism for transaction prices …

We present a new partial equilibrium theory of price adjustment, based on consumer loss aversion. In line with prospect … theory, the consumers' perceived utility losses from price increases are weighted more heavily than the perceived utility … an otherwise standard dynamic neoclassical model of monopolistic competition. The resulting theory of price adjustment is …

-utility constrained social optimum. Unexpectedly, numerical simulations show that this theory could account for the observed distribution …

. In theory, poorly informed consumers can protect themselves from maltreatment through sellers by asking for second …

This paper deals with one of the main empirical problems associated with the rational addiction theory, namely that its …