We analyze households' responses to an unanticipated change in consumption opportunities and evaluate their implications for the nature and formation of preferences. We study the tariff experiment conducted by South Central Bell where local telephone tariffs were introduced for the first time in...

The analysis in this paper searches for individual and group determinants of learning behavior in Monty Hall's Three Door problem examined in Friedman (1998). The results show that the size of monetary incentives, individuals' initial abilities, and social interactions with others are all...