Addiction and Cue-Triggered Decision Processes

B. Douglas Bernheim and Antonio Rangel

American Economic Review, 2004, vol. 94, issue 5, 1558-1590

Abstract: We propose a model of addiction based on three premises: (i) use among addicts is frequently a mistake; (ii) experience sensitizes an individual to environmental cues that trigger mistaken usage; (iii) addicts understand and manage their susceptibilities. We argue that these premises find support in evidence from psychology, neuroscience, and clinical practice. The model is tractable and generates a plausible mapping between behavior and the characteristics of the user, substance, and environment. It accounts for a number of important patterns associated with addiction, gives rise to a clear welfare standard, and has novel implications for policy.

Date: 2004
Note: DOI: 10.1257/0002828043052222
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