Temptation, self-control, and competitive nonlinear pricing |
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| Authors: | Susanna Esteban Eiichi Miyagawa |
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| Affiliation: | aDepartment of Economics, Pennsylvania State University, University Park, PA 16802, United States;bDepartment of Economics, Columbia University, New York, NY 10027, United States |
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| Abstract: | Standard pricing theories consider consumers without temptation. With temptation and costly self-control, consumers dislike choice sets with tempting alternatives. We study firms' strategy against such consumers, using Gul–Pesendorfer preferences and a game where firms compete by offering menus. |
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| Keywords: | Temptation Self-control Nonlinear pricing Pooling Participation fees |
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