Mental models help people navigate complex environments. This paper studies how people deal with model uncertainty. In an experiment, participants estimate a company's value, facing uncertainty about which one of two models correctly determines its true value. Using a between-subjects design, we...

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 conduct an experiment where subjects read online news articles and are shown ads for brands next to those articles. Using eye-tracking technology, we measure the attention that each individual devotes to each article and ad. Then, respondents choose between cash or vouchers for the brands...

Mainstream logic supports the idea that platforms bring large benefits to firms, especially smaller ones, by opening up access to a broader set of consumers and making firms' products easier to find. However, this argument mostly applies to transaction platforms that match consumer preferences...

We provide an explanation for a frequently observed vertical restraint in ecommerce, namely that brand manufacturers partially or completely prohibit that retailers distribute their high-quality products over the internet. Our analysis is based on the assumption that a consumer's purchasing...

We provide a novel intuition for the observation that many brand manufacturers have restricted their retailers' ability to resell brand products online. Our approach builds on models of salience according to which price disparities across distribution channels guide a consumer’s attention...

We study response behavior in surveys and propose a method to identify and improve the informativeness of survey evidence. First, we develop a choice model of survey response behavior under the assumption that responses imperfectly reveal respondents' characteristics due to limited...

Most news stories contain both granular quantitative information and coarse categorizations. For instance, company earnings are typically reported as a dollar figure alongside categorizations, such as whether earnings beat or missed market expectations. We study the hypothesis that when a...

This paper estimates a New Keynesian model with new and old behavioral elements. Agents in the model exhibit cognitive discounting, or myopia: they discount variables far into the future at higher rates than typically implied in the benchmark model. We investigate the model under different...