Do Addicts Behave Rationally?
AbstractThe theory of rational addiction assumes that addicts' behavior is fully rational. Common sense and psychological introspection suggest, however, that addictive behavior is irrational. Without knowledge of the addicts' preferences this dispute cannot be resolved. This paper reports the results of an experiment in which addictive preferences were induced. It turns out that 'addicts' consume systematically too much compared to the optimal consumption decision. The authors explain this systematic excess consumption in terms of the psychologically salient features of addictive goods. Copyright 1998 by The editors of the Scandinavian Journal of Economics.
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Length: 20 pages
Date of creation: 07 May 2003
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Addicts; Rational Behavior;
Other versions of this item:
- D9 - Microeconomics - - Intertemporal Choice
- C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
- C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
This paper has been announced in the following NEP Reports:
- NEP-ALL-2003-05-15 (All new papers)
- NEP-CBE-2003-05-15 (Cognitive & Behavioural Economics)
- NEP-HEA-2003-05-15 (Health Economics)
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