Payments and discounts incentivize participation in many transactions about which people know little, but can learn more --- payments for medical trial participation, signing bonuses for job applicants, or price rebates on consumer durables. Who opts into the transaction when given such...

Who participates in transactions when information about the consequences must be learned? We show theoretically that decision makers for whom acquiring and processing information is more costly respond more strongly to changes in incentive payments for participating and decide to participate...

We investigate the interaction between the law’s prohibition of recovery for unrequested benefits, and parties’ incentives at the ex ante stage to acquire information about the harms or benefits of the activities they consider engaging in. We analyze the impact of these interactions on the...

Market interactions are brought about by the interplay of entitlements and obligations. Entitlements are rights, as perceived by the individuals. They are subjectively perceived rights that go along with a motivational disposition to defend them. Obligations are the counterparts of entitlements....

This paper studies static rational inattention problems with multiple actions and multiple shocks. We solve for the optimal signals chosen by agents and provide tools to interpret information processing. By relaxing restrictive assumptions previously used to gain tractability, we allow agents...

We analyze a simple supply chain with one supplier, one retailer and uncertainty about market demand. Focusing on the incentives of the supplier and the retailer to enhance their private information about the actual market conditions, we show that choices on information acquisition are strategic...

We study contracting between a consumer and an expert. The expert can invest in diagnosis to obtain a noisy signal about whether a low-cost service is sufficient or whether a high-cost treatment is required to solve the consumerś problem. This involves moral hazard because diagnosis effort and...