Cigarettes are experience goods - most of their utility value only gets revealed when one consumes them. We hypothesize a three phase consumer life cycle for experience goods. Consumers initially do not know their utility from the good or their preferences for particular characteristics, and may...

Many consumers have had the experience of entering discount membership clubs to make a few purchases, only to leave with enough pasta to outlast a nuclear winter. We suggest that the presence of membership fees can lead consumers to infer a quot;fees -gt; savingsquot; link, spurring them to...

This article evaluates two different remedies for consumers who have been injured by a price overcharge on the sale of a good. Under a coupon remedy, injured consumers are awarded coupons that can be used for a limited period of time to purchase the good at a price below that which prevails...