Designing Price Contracts for Boundedly Rational Customers

LimNoah · HoTeck-Hua

24 citations0/0 files storedMarketing Science

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Supply Chain and Inventory Management Decision-Making and Behavioral Economics Consumer Market Behavior and Pricing

Abstract

When designing price contracts, one of the major questions confronting managers is how many blocks there should be in the contract. We investigate this question in the setting of a manufacturer-ret...

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References

1988Prospect theory: An analysis of decision under risk 2003Behavioral Game Theory: Experiments in Strategic Interaction 1986Norm theory: Comparing reality to its alternatives.1995Quantal Response Equilibria for Normal Form Games 1999The Effects of Financial Incentives in Experiments: A Review and Capital-Labor-Production Framework 1993Context-Dependent Preferences 1991Price Competition in a Channel Structure with a Common Retailer 2004Contract Design and Self-Control: Theory and Evidence

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2009Are All Managers Created Equal?2013Context-Dependent Preferences and Innovation Strategy 2010Marketing modeling reality and the realities of marketing modeling 2013Relationship Organization and Price Delegation: An Experimental Study 2008Experiments on strategic choices and markets

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