|Sector:||Abuse of dominance | Behavioural | Behavioural and experimental economics | Competition | Competition Economics|
|Tagged:||experiments other international|
Consumer behavioural biases imply that consumers may not behave in the fully rational way that many economic models assume. This study assesses what impact behavioural biases can have on competition, including, how competition and pricing practices may change when consumers are biased; if lowering barriers to entry can reduce inefficiencies that arise from consumer behavioural biases; situations where biased consumers make rational ones better or worse off; and, the role of education and learning in mitigating biased behaviour.
The report considers the key implications for consumer and competition policy in particular to understand how and when competitive equilibrium may change for the worse. It also contributes to our understanding of when, why, and how governments should intervene.