People often act out of a desire to be responsible for good and not for bad events. Similarly, people frequently reward and punish other people if they perceive them to be responsible for the implementation of events that they like or dislike. When the implementation of an event depends on the...

People frequently reward and punish other people if they perceive them to be responsible for the implementation of events that they like or dislike. However, the determinants of such responsibility perceptions are not well understood within economics. In this paper, I propose a notion of causal...

We study an extension of the model of Rubinstein (1993) to two firms, competing in a market with consumers who are boundedly rational with respect to processing information. The cognitive bound forces customers to partition the price space. Rubinstein shows that a monopolist is able to earn a...

We present a model of boundedly rational play in single-shot 2 × 2 games. Players choose strategies based on the perceived salience of their own payoffs and, if own-payoff salience is uninformative, on the perceived salience of their opponent's payoffs. When own payoffs are salient, the model's...

We experimentally investigate, in an unstructured bargaining environment with commonlyknown money payoffs, the Attraction Effect and Compromise Effect (AE and CE) in bargaining,namely a tendency for bargainers to agree to an intermediate option (CE), or to an optionthat dominates another option...

We analyse the determination of taxes on harmful goods when consumers have self-control problems. We show that under reasonable assumptions, the socially optimal corrective tax exceeds the average distortion caused by self-control problems. Further, we analyse how individuals with self-control...