Summary While standard economic theory takes individual preferences as stable and “given”, i.e., independent of situational context, real-world preferences tend to vary with changing opportunity sets. This is exemplified by Aesop’s fable of the fox and the sour grapes. This phenomenon of...

Summary In pursuing their plans economic agents regularly have to adjust their pacing of orders, production, and deliveries in unanticipated ways. Information constraints turn many of these adjustments into myopic reactions to accelerations/decelerations observed in the activity level of...