Spiegler, R: Bounded Rationality and Industrial Organization

1 Introduction; I Anticipating Future Preferences; 2 Dynamically Inconsistent Preferences I: Unconstrained Contracting; 3 Dynamically Inconsistent Preferences II: Constrained Contracting; 4 Dynamically Inconsistent Preferences III: Partial Naivety; 5 Biased Beliefs without Dynamic Inconsistency; II Responding to Market Complexity; 6 Sampling-Based Reasoning: Price Competition and Product Differentiation; 7 Sampling-Based Reasoning: Obfuscation; 8 Coarse Reasoning; III Reference Dependence; 9 Loss Aversion; 10 Inertia I: Price Competition; 11 Inertia II: Costly Marketing 261; IV Discussion; 12 Recurring Themes; 13 But Can't we Get the Same Thing with a Standard Model?; Bibliography; Index

Ran Spiegler is Professor of Economics at Tel Aviv University and University College London.

"Nobody thinks like Adam Smith when buying a toothbrush, but this is the assumption of consumer behavior offered in traditional economics textbooks. Marketing experts used to laugh at such naivety, but they will have to take economic theory more seriously from now on. Ran Spiegler's book takes on the challenge of rewriting the theory of industrial organization without the classical assumption that economic agents are all rational supermen. This is an important book that nobody working on industrial organization will wish to be without."--Ken Binmore, University College London

"Spiegler's Bounded Rationality and Industrial Organization is a beautifully written book. He makes a compelling case that understanding what happens when boundedly rational consumers meet sophisticated firms is both intellectually interesting and practically important. He has a wonderful feel for using rigorous models to clarify arguments and develops insights from a number of branches of the emerging literature in a parsimonious way. It is a must read book."--Glenn Ellison, Massachusetts Institute of Technology

"In a timely and indispensable contribution, Ran Spiegler presents formal, elegant, and stylized models that synthesize and find common ground in previous approaches to incorporating non-standard assumptions of consumer behavior into otherwise standard market settings. His textbook will be an extremely valuable source for students wanting to learn more about modeling bounded rationality. And his unifying models will likely set the stage for further contributions in this exciting area."--Ignacio Esponda, Stern School of Business, New York University

"Over the past decade, Ran Spiegler has been a market leader at incorporating models of bounded rationality into the theory of industrial organization. The book lucidly distills often complex models to their essential elements, often by offering new and improved versions. Always elegant and occasionally iconoclastic, Sp