Store Design with Self-Control Preferences

Susanna Esteban ()

No 73, 2004 Meeting Papers from Society for Economic Dynamics

Abstract: In this paper, we analyze the problem of store design when consumers have preferences with temptation and self-control, as introduced by Gul and Pesendorfer (2001). We say that a monopolist designs its stores when it chooses the number of stores to open and the quality and price of the goods to sell in each of them. We ask the question of whether consumers' preferences with temptation and self-control can explain a monopolist's choice between superstores and specialized stores. We find that a monopolist opens superstores to sell to some consumer types and specialized stores to sell to some others. We thus provide a demand driven explanation for the co-existence and design of multi-product and specialized stores

Keywords: temptation; self-control; nonlinear pricing; price discrimination; store design (search for similar items in EconPapers)
JEL-codes: D42 D82 L12 (search for similar items in EconPapers)
Date: 2004

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Persistent link: http://EconPapers.repec.org/RePEc:red:sed004:73

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