This thesis has two major themes. The first theme (Chapters 1 – 3) focuses on search theory and industrial organisation. I build a novel model of costly search where firms choose price distributions, draws are then taken from these distributions and the collection of draws is presented to consumers. Consumers are aware of the set of prices that firms charge but do not know which price is associated with which firm. As they search, they learn and update their beliefs about the prices offered by the other firms. I extend the model by introducing a price comparison website as well as informed and uninformed consumers. Equilibrium in the model has certain desirable properties. The second theme (Chapters 4 – 6) focuses on game theory, and in particular, games with forgetful players. One of the 'conclusions' of the Games and Economics Behaviour collection of papers on imperfect recall is that there is no one way to model imperfect recall in games; in particular, modelling issues which are of little or no consequence in games of perfect recall suddenly become substantive in games of imperfect recall. Furthermore, there is little consensus on how to proceed. I introduce a class of decision problems where, if we think of forgetting in a novel but intuitive way, we can transform the game into a game of perfect recall – thus resolving the modelling ambiguities. I extend the model to show that an agent with self-control problems may in certain cases be better off having a bad memory. I consider whether a firm can offer different contracts to discriminate between different types of consumer with varying degrees of memory and sophistication. Finally, I consider the consumption behaviour of a forgetful consumer.
| Identifer | oai:union.ndltd.org:bl.uk/oai:ethos.bl.uk:668424 |
| Date | January 2015 |
| Creators | Rashid, M. |
| Publisher | University College London (University of London) |
| Source Sets | Ethos UK |
| Detected Language | English |
| Type | Electronic Thesis or Dissertation |
| Source | http://discovery.ucl.ac.uk/1425119/ |
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