Rigid pricing and rationally inattentive consumer

• 成果类型: Article
• 署名作者: Matejka, Filip
• 署名单位: Czech Academy of Sciences; Economics Institute of the Czech Academy of Sciences; Charles University Prague; Czech Academy of Sciences; Economics Institute of the Czech Academy of Sciences
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/j.jet.2015.01.021
• 发表日期: 2015
• 页码: 656-678
• 关键词: rational inattention; imperfect information; Nominal rigidity

摘要

This paper proposes a mechanism leading to rigid pricing as an optimal strategy. It applies a framework of rational inattention to study the pricing strategies of a monopolistic seller facing a consumer with limited information capacity. The consumer needs to process information about the realized price, while the seller is perfectly attentive. The seller chooses to price rigidly, i.e. prices respond to changes in the unit input cost less than if the consumer was perfectly attentive. The rigidity is sometimes manifested by discreteness of prices the seller charges a finite set of different prices even for a continuous range of unit input costs. The seller does so to provide the consumer with easily observable prices, which stimulates her to consume more and increases the seller's profit. (C) 2015 Elsevier Inc. All rights reserved.