Incorporating behavioral anomalies in strategic models

Chakravarthi Narasimhan*, Chuan He, Eric Anderson, Lyle Brenner, Preyas Desai, Dmitri Kuksov, Paul Messinger, Sridhar Moorthy, Joseph Nunes, Yuval Rottenstreich, Richard Staelin, George Wu, Z. John Zhang

*Corresponding author for this work

Research output: Contribution to journalArticle

18 Scopus citations

Abstract

Behavioral decision researchers have documented a number of anomalies that seem to run counter to established theories of consumer behavior from microeconomics that are often at the core of analytical models in marketing. A natural question therefore is how equilibrium behavior and strategies would change if models were to incorporate these anomalies in a consistent way. In this paper we identify several important and generalizable anomalies that modelers may want to incorporate in their models. We briefly discuss each phenomenon, identify a key unresolved issue and outline a research agenda to be pursued.

Original languageEnglish (US)
Pages (from-to)361-373
Number of pages13
JournalMarketing Letters
Volume16
Issue number3-4
DOIs
StatePublished - Dec 1 2005

Keywords

  • Confirmatory bias
  • Fairness
  • Game theory
  • Marketing strategy
  • Reference dependence

ASJC Scopus subject areas

  • Business and International Management
  • Economics and Econometrics
  • Marketing

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