disutility from changing consumption levels. The derived preference exhibits intertemporal loss aversion toward consumption …

intense debate. Two main families of models claim to solve this puzzle: habit-formation models and loss-aversion models. The … the observed data. The loss aversion model and the internal habit model could fit the observed excess return evolution …

such coarse screening, based on consumer loss aversion. In our model, a seller offers a menu of bundles before a consumer … learns his willingness to pay, and the consumer experiences gain-loss utility with reference to his prior (rational … offer a pooling menu under an intermediate range of loss aversion if the likelihood of low willingness-to-pay consumer is …

(type), and a gain-loss valuation that depends on deviations of purchased quality from a reference point. Following Koszegi … Rabin (2006), we consider loss-averse buyers who evaluate gains and losses in terms of changes in the consumption valuation … of the Mirrlees representation of the indirect utility to fully characterize optimal contracts for loss-averse consumers …