Overcoming Choice Inertia through Social Interaction—An Agent-Based Study of Mobile Subscription Decision

Barsha Saha, Miguel Martínez-García, Sharad Bhattacharya and Rohit Joshi
Additional contact information
Barsha Saha: Indian Institute of Management Shillong, Shillong 793018, India
Miguel Martínez-García: Department of Aeronautical and Automotive Engineering, Loughborough University, Loughborough LE11 3TU, UK
Rohit Joshi: Indian Institute of Management Shillong, Shillong 793018, India

Games, 2022, vol. 13, issue 3, 1-16

Abstract: Subscription decision in the telecom market is quite complex and cumbersome, invoking decision inertia in consumers and resulting in suboptimal choices. We implemented choice inertia and consumer interaction as an agent-based model to better understand the process. The model illustrates that with adequate peer interactions with active consumers, inactive consumers could overcome their inertia significantly and switch to a better alternative. Furthermore, the newly converted active consumers influenced their inert neighbors as a ripple effect. Active consumers contribute to firm profits and healthy market competition. Moreover, in environments with low neighborhood effects and a stronger inertia threshold, firms are able to maintain profits by retaining inert consumers. We show that apart from the attractiveness of market offerings, firms can benefit from understanding consumer inertia and devising means to reduce it.

Keywords: consumer behavior (inertia); telecommunications; competition; game theory; agent-based modelling; homophily; complexity (search for similar items in EconPapers)
JEL-codes: C C7 C70 C71 C72 C73 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.mdpi.com/2073-4336/13/3/47/pdf (application/pdf)
https://www.mdpi.com/2073-4336/13/3/47/ (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gam:jgames:v:13:y:2022:i:3:p:47-:d:842889

Access Statistics for this article

Games is currently edited by Ms. Susie Huang

More articles in Games from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().