I present a game-theoretic model where economic competition and attention competition are interdependent. On the one hand the effort to attract consumer attention depends on the value of attention to the firm which depends on the grade of price competition among all perceived firms. On the other...

I present a game-theoretic model where economic competition and attention competition are interdependent. On the one hand the effort to attract consumer attention depends on the value of attention to the firm which depends on the grade of price competition among all perceived firms. On the other...

A market where short-lived customers interact with a long-lived expert is considered. An expert privately observes whether or not a particular treatment is necessary for his customers and has an incentive to recommend the treatment even if it is unnecessary. Customers imperfectly observe the...

Product information websites have become ubiquitous in supporting B2C E-Commerce. This paper explores their impact on firm profitability, consumer surplus, and social welfare. Using an analytical model, we show that firms take advantage of such infomediaries and reduce their own information...

It is becoming increasingly important for firms to know when to take steps to reduce buyers' uncertainty about their products and services. This article focuses on investments that firms can make to reduce buyers' uncertainty about taste-related product attributes. Using an analytical model, we...

Dual-process theories view decisions as the result of the interaction of two qualitatively different types of processes, automatic/impulsive and controlled/deliberative. This paper considers a model of self-control where each decision can be taken by either an automatic process or a deliberative...

We analyze subjects' eye movements while they make decisions in a series of one-shot games. The majority of them perform a partial and selective analysis of the payoff matrix, often ignoring the payoffs of the opponent and/or paying attention only to specific cells. Our results suggest that...

Using a standard strategic pricing game, I determine how sellers set prices when facing buyers who are “rationally inattentive” to information about product quality. Two cases are studied: strategically sophisticated buyers who are rationally inattentive to exogenous information about...