incorporates both addiction and social interactions and show that, under certain conditions, social interactions reinforce the … effects of addiction. I also show how the dynamics introduced by addiction can solve the pernicious problem of identifying the …

A standard model of addictive process is Becker and Murphy's rational addiction' model, which has the key empirical … per pack of cigarettes should be at least one dollar higher under our formulation than in the rational addiction case …

We propose an economic theory of addiction based on the premise that cognitive mechanisms such as attention affect … neurosciencee and psychology) concerning the nature of decision-making and addiction. The model is analytically tractable, and it … accounts for a broad range of stylized facts concerning addiction. It also generates a plausible qualitative mapping from the …

their addiction to dollars. Concretely, we try to explain why some countries have been able to avoid certain forms of the … addiction, and examine the evidence on successful de-dollarization …

hypothesis of rational addiction and inconsistent with the hypothesis of myopic addiction. The long-run elasticity of consumption … as the elasticity that ignores addiction …

This paper applies the rational addiction model, which emphasizes the interdependency of past, current, and future …

addiction. In contrast to prior research, we allow individuals to make their consumption decisions simultaneous with savings and … labor supply. When addictive goods have a stronger habit formation effect (an addiction effect'), individuals choose to save … less due to the anticipated adverse health consequences of addiction (a detrimental health effect'). This is particularly …