I study a market model in which profit-maximizing firms compete in multi-dimensional pricing strategies over a consumer, who is limited in his ability to grasp such complicated objects and therefore uses a sampling procedure to evaluate them. Firms respond to increased competition with an...

A market model is presented, in which firms and consumers differ in their market understanding. In the model, rational firms compete in probability distributions over consumers with bounded ability to grasp statistical data. Increased competition causes firms to increase their effort to...