Adaptive selling is a tailored client-centric approach to selling, that literally adapts to the needs and problems of the customer. 

Adaptive selling is a custom or tailored approach to selling, which takes into account the type of customer, the sales situation, and the feedback received. Because adaptive selling requires a more consultative approach to sales and customer service, it requires expensively trained salespeople, who know the product they are selling inside out and can use their judgment to adjust their sales approach based on their customer’s needs and state of mind. Adaptive selling is a custom or tailored approach to selling, which takes into account the type of customer, the sales situation, and the feedback received. Adaptive selling is being used very effectively today in the e-commerce and tech industries, where online retailers and other businesses are able to use big data and computer algorithms to more precisely target their marketing, according to their customers’ past purchases, tastes, and demographics. Adaptive selling is a tailored client-centric approach to selling, that literally adapts to the needs and problems of the customer.

Adaptive Selling

Adopter categories divide consumers into segments based on their willingness to try out a new innovation or product.

Adopter categories divide consumers into segments based on their willingness to try out a new innovation or product. According to his research, there are five adopter categories—innovators, early adopters, early majority, late majority, and laggards. Adopter categories, as a term, is part of the Diffusion of Innovations Theory and has been applied to several studies, including marketing, organizational studies, knowledge management, communications, and complexity studies, among others. Rogers identified key characteristics of each adopter category, such as the fact that early adopters have the highest degree of opinion leadership among the adopter categories, while the laggards are likely to be older, conservative, and more price conscious. Adopter categories, as a term, is part of the diffusion of innovations theory and has been applied to several studies, including marketing, organizational studies, knowledge management, communications, and complexity studies, among others.

Adopter Categories

An all-pay auction is an economic and game theory concept in which participants place silent bids on a particular item. 

An all-pay auction is an auction that requires all bidding participants pay their bid amount, regardless of whether they have placed the highest bid. An all-pay auction is an auction that requires all bidding participants pay their bid amount, regardless of whether they have placed the highest bid. An all-pay auction game theory revolves around the idea of an auction where all participants are placing silent bids with the knowledge that they will be required to pay even if theirs isn’t the winning bid. It is common in these scenarios for bidders to overbid, or place offers that are higher than the intrinsic value of the item they are bidding on, in hopes of securing the winning bid. Similarly, a lottery is another form of an all-pay auction since each person who purchases a lottery ticket is paying for a chance to win.

All-Pay Auction

When an individual makes estimates based on an initial value or figures they fixate on, it is called anchoring and adjustment.

A Literature Review of the Anchoring Effect

The Anchoring Effect and How it Can Impact Your Negotiation

Expert Political Judgment: How Good Is It? How Can We Know?

Anchoring and adjustment is a phenomenon wherein an individual bases their initial ideas and responses on one point of information and makes changes driven by that starting point. In experimental studies, telling people about anchoring, cautioning them that it can bias their judgment, and even offering them monetary incentives to avoid anchoring can reduce, but not eliminate, the effect of anchoring.
Higher levels of experience and skill in a specific field can help reduce the impact of anchoring in that subject area, and higher general cognitive ability may reduce anchoring effects in general. The problem with anchoring and adjustment is that if the value of the initial anchor is not the true value, then all subsequent adjustments will be systematically biased toward the anchor and away from the true value. The anchoring and adjustment heuristic describes cases in which a person uses a specific target number or value as a starting point, known as an anchor, and subsequently adjusts that information until an acceptable value is reached over time. Unlike the conservatism bias, which has similar effects but is based on how investors relate new information to old information, anchoring occurs when an individual makes new decisions based on the old, anchor number.

Anchoring and Adjustment

"Animal spirits" is a term used by economist John Maynard Keynes to explain how human emotions can drive financial decision-making in volatile times. 

Table of Contents
What Are Animal Spirits?
Understanding Animal Spirits
Animal Spirits in Finance
Examples of Animal Spirits
Critiques of Animal Spirits
 Table of Contents
What Are Animal Spirits?
Understanding Animal Spirits
Animal Spirits in Finance
Examples of Animal Spirits
Critiques of Animal Spirits Animal spirits can give rise to bubbles in asset prices, and also can lead to panic selling.
According to the theory behind animal spirits, the decisions of business leaders are based on intuition and the behavior of their competitors rather than on solid analysis. In 2009, the term animal spirits returned to popularity when two economists—George A. Akerlof (Nobel laureate and professor of economics at University of California) and Robert J. Shiller (professor of economics at Yale University)—published their book, _Animal Spirits: How Human Psychology Drives the Economy, and Why it Matters for Global Capitalism_. Animal spirits represent the emotions of confidence, hope, fear, and pessimism that can affect financial decision-making, which in turn can fuel or hamper economic growth.

Animal Spirits

In game theory, backward induction is the process of deducing backward from the end of a problem or scenario to infer a sequence of optimal actions. 

Backward induction in game theory is an iterative process of reasoning backward in time, from the end of a problem or situation, to solve finite extensive form and sequential games, and infer a sequence of optimal actions. The Nash equilibrium of this game, where no player has an incentive to deviate from his chosen strategy after considering an opponent's choice, suggests the first player would take the pot on the very first round of the game. At each stage of the game backward induction determines the optimal strategy of the player who makes the last move in the game. The game is also sequential, so Player 1 makes the first decision (left or right) and Player 2 makes its decision after Player 1 (up or down). The game concludes as soon as a player takes the stash, with that player getting the larger portion and the other player getting the smaller portion.

Backward Induction

The bandwagon effect is a phenomenon in which people do something primarily because other people are doing it.

The bandwagon effect is a psychological phenomenon in which people do something primarily because other people are doing it, regardless of their own beliefs, which they may ignore or override. Investing and financial markets can be especially vulnerable to bandwagon effects because not only will the same kind of social, psychological, and information-economizing factors occur, but additionally the prices of assets tend to rise as more people jump on the bandwagon. To some extent, this is a beneficial and useful tendency; if other people's preferences are similar, their consumption decisions are rational, and they have accurate information about the relative quality of available consumer goods, then it makes perfect sense to follow their lead and effectively outsource the cost of gathering information to someone else. Economically, some amount of bandwagon effect can make sense, in that it allows people to economize on the costs of gathering information by relying on the knowledge and opinions of others. The bandwagon effect is a psychological phenomenon in which people do something primarily because other people are doing it, regardless of their own beliefs, which they may ignore or override.

Bandwagon Effect

Base rate fallacy, or base rate neglect, is a cognitive error whereby too little weight is placed on the base (original) rate of possibility.

Base rate fallacy, or base rate neglect, is a cognitive error whereby too little weight is placed on the base, or original rate, of possibility (e.g., the probability of A given B). Base rate fallacy, or base rate neglect, is a cognitive error whereby too little weight is placed on the base, or original rate, of possibility (e.g., the probability of A given B). While the base of information⁠—the company's solid financial position, consistent growth rates, management with proven track records, and an industry with strong demand⁠—all point to its ability to outperform, a weak earnings quarter could set investors back, making them think that this is changing the company’s course. The first is general probability, whereas the second is event-specific information, such as how many basis points the market has shifted, what percentage a company is off in its corporate earnings, or how many times a company has changed management. In behavioral finance, base rate fallacy is the tendency for people to erroneously judge the likelihood of a situation by not taking into account all relevant data.

Base Rate Fallacy

Behavioral modeling means using available and relevant consumer and business spending data to estimate future behavior.

Behavioral modeling is an approach used by companies to better understand and predict consumer actions. For example, a credit card company will examine the types of businesses that a card is normally used at, the location of stores, the frequency and amount of each purchase to estimate both future purchase behavior, and whether a cardholder is likely to run into repayment problems. A retailer could, for example, examine the types of products that a consumer purchases in-store or online and then estimate the likelihood that the consumer will purchase a new product based on how similar it is to their previous purchases. Behavioral modeling simply tries to capture some of the psychology of decision making to provide a better simulation of how decisions are made by a consumer and the probability of a particular consumer making one choice over another. For example, if a store determines that consumers that purchase shampoo will also purchase soap if provided a coupon, the store may provide a coupon for soap at a point-of-sale terminal to a consumer who only purchases shampoo.

Behavioral Modeling

Behavioral Economics is the study of psychology as it relates to the economic decision-making processes of individuals and institutions.

Behavioral Economics is the study of psychology as it relates to the economic decision-making processes of individuals and institutions. Behavioral game theory, an emergent class of game theory, can also be applied to behavioral economics as game theory runs experiments and analyzes people’s decisions to make irrational choices. The two most important questions in this field are:
1\. Are economists' assumptions of utility or profit maximization good approximations of real people's behavior?
2\. Do individuals maximize subjective expected utility?
Behavioral economics is often related with normative economics. 1:42
Behavioral economics draws on psychology and economics to explore why people sometimes make irrational decisions, and why and how their behavior does not follow the predictions of economic models. If a commercial on TV advertises a brand of ice cream at an attractive price and quotes that all human beings need 2,000 calories a day to function effectively after all, the mouth-watering ice cream image, price, and seemingly valid statistics may lead Charles to fall into the sweet temptation and fall off of the weight loss bandwagon, showing his lack of self-control.

Behavioral Economics

A behaviorist accepts the often irrational nature of human decision-making as an explanation for inefficiencies in financial markets.

A behaviorist is an adherent of the theories of behavioral economics and finance, which hold that investors and other market participants neither behave in a rational manner nor in their own best interests. Critics of behavioral economics and behavioral finance point out that, for the most part, rational choice theory and the models derived from it, such as the laws of supply and demand and the vast majority of economic models, do indeed do a pretty good job of explaining and predicting observed behavior of investors and other participants in the economy. Others argue that the cognitive biases that behaviorists highlight to explain allegedly irrational behavioral, while they may narrowly violate the assumptions of rational choice theory, are actually rational in some broader sense. Behaviorists point to a wide range of cognitive biases that have been described by researchers to explain various market imperfections and deviations from the predictions of economic models based on rational choice theory. Behaviorists favor the theories of behavioral economics and behavioral finance, which highlight economic behaviors that appear to violate traditional rational choice theory.

Behaviorist

Bernoulli's hypothesis states a person accepts risk both on the basis of possible losses or gains and the utility gained from the action itself.

Bernoulli's Hypothesis states a person accepts risk not only on the basis of possible losses or gains, but also based upon the utility gained from the risky action itself. As the amount of money a person has grows, the person may become more risk averse (despite their ability to take on risk increasing due to their increase in capital) because they are experiencing diminished marginal utility with every extra dollar earned. Bernoulli's Hypothesis states a person accepts risk not only on the basis of possible losses or gains, but also based upon the utility gained from the risky action itself. Bernoulli's hypothesis states a person accepts risk both on the basis of possible losses or gains and the utility gained from the action itself. Related closely to the idea of diminishing marginal returns, Bernoulli's hypothesis essentially states that one should not accept a highly risky investment choice if the potential returns will provide little utility, or value.

Bernoulli's Hypothesis

Bias is an irrational assumption or belief that warps the ability to make a decision based on facts and evidence.

Bias is an illogical or irrational preference or prejudice held by an individual, which may also be subconscious. Smart investors avoid two big types of bias—emotional bias and cognitive bias. Mood bias, optimism (or pessimism) bias, and overconfidence bias all add a note of irrationality and emotion to the decision-making process. Psychologists have identified a number of types of bias that are relevant to investors:
Representative bias may lead to snap judgments because of a situation's similarities to an earlier matter.
Cognitive dissonance leads to an avoidance of uncomfortable facts that contradict one's convictions. Reference point bias and anchoring bias are tendencies to value a thing in comparison to another thing rather than independently.

Bias

Bioeconomics is a progressive branch of social science that seeks to integrate the disciplines of economics and biology to explain economic events.

Bioeconomics is a progressive branch of social science that seeks to integrate the disciplines of economics and biology for the sole purpose of creating theories that do a better job of explaining economic events using a biological basis and vice versa. Bioeconomics is a progressive branch of social science that seeks to integrate the disciplines of economics and biology for the sole purpose of creating theories that do a better job of explaining economic events using a biological basis and vice versa. With the help of modeling, bioeconomics can help determine optimal natural resource usage. Ultimately, extinction or resource depletion is driven by a low natural growth rate, high price-cost ratio, and high opportunity cost. Bioeconomic modeling is much like economic modeling, factoring in natural resource management.

Bioeconomics

Black Monday, Oct. 19, 1987, was a day when the Dow Jones Industrial Average fell by 22% and marked the start of a global stock market decline.

Future Trader Pleads Guilty to Illegally Manipulating The Futures Market in Connection With 2010 Flash Crash

Black Monday refers to the stock market crash that occurred on Oct. 19, 1987 when the DJIA lost almost 22% in a single day, triggering a global stock market decline. The stock market crash of 1987 revealed the role of financial and technological innovation in increased market volatility. Since Black Monday, a number of protective mechanisms have been built into the market to prevent panic selling, such as trading curbs and circuit breakers. 1:03
The cause of the massive stock market drop cannot be attributed to any single news event since no major news event was released the weekend preceding the crash.

Black Monday

Boomernomics is the economy of the "baby boomer" generation, which can inform an investment strategy to capitalize on their consumption patterns.

Boomernomics is the economy of the "baby boomer" generation, which can inform an investment strategy to capitalize on the consumption patterns of the group. Boomernomics is a buzzword originating from the title of a 1999 book by investment advisers William Sterling and Steven Waite, _Boomernomics: The Future of Your Money in the Upcoming Generational Warfare_. Boomernomics is an investment strategy based on the economic impact of the aging baby boomer generation. This is essentially the same idea that has been widely described and discussed by other authors and investment gurus, including Ken Dychtwald's Age Wave Theory and the demographic investment strategies advocated by investor Harry Dent. _Boomernomics_ in particular predicts that the retirement of the Baby Boomers will involve a period of intergenerational conflict (as well as conflict between the more and less successful members of this generation) over economic resources, rising taxation, and lower historical returns on major asset classes.

Boomernomics

Brinkmanship is a negotiating technique where one party aggressively pursues a set of terms so that the other party must either agree or disengage. 

Brinkmanship is a negotiating technique where one party aggressively pursues a set of terms so that the other party must either agree or disengage. A party that does not have market power, whose counterparty does have market power, or who is heavily invested in relationship-specific assets will be both less successful in pursuing a brinkmanship strategy and will be more vulnerable to brinkmanship themselves. It may even go so far as to alienate an opposing party and cause a failure in negotiations in which no party does business and a business relationship cannot be salvaged for many years to come. The rewards from brinkmanship are potentially greater than in a more amiable negotiation since the more aggressive party is likely to gain better terms if their strategy is successful. An existing relationship with a counterparty that includes their investment in relationship-specific assets gives an advantage to a brinksmanship strategy because the counterparty risks losing the value of the relationship.

Brinkmanship

Bubble theory is a theory that markets occasionally push prices above their true values, leading to large or persistent overvaluations in asset prices

The bubble theory is based on the recognition that market prices, especially commodity, real estate, and financial asset prices, occasionally experience rapidly rising prices as investors begin buying beyond what may seem like rational prices. The bubble theory is based on the recognition that market prices, especially commodity, real estate, and financial asset prices, occasionally experience rapidly rising prices as investors begin buying beyond what may seem like rational prices. Since bubbles depend upon a rise in prices that outstrips the value of an asset class, it stands to reason that investors interested in identifying them should look to charts for radical price changes that occur over short periods of time. The bubble theory is any economic or financial theory that recognizes the existence of or seeks to explain bubbles in market prices. The effort pays off if an investor recognizes the bubble before it bursts and gets out before the losses begin to mount, so many investors spend significant time and energy attempting to detect bubbles.

Bubble Theory

The centipede game in game theory involves two players alternately getting a chance to take the larger share of an increasing money stash.

The centipede game is an extensive-form game in game theory in which two players alternately get a chance to take the larger share of a slowly increasing money stash. The centipede game is an extensive-form game in game theory in which two players alternately get a chance to take the larger share of a slowly increasing money stash. The centipede game concludes as soon as a player takes the stash, with that player getting the larger portion and the other player getting the smaller portion. The payoff is now increased by $2 to $4; if Jill takes, she gets $3 and Jack gets $1, but if she passes, Jack gets to decide whether to take or pass. Using backward induction—which is the process of reasoning backward from the end of a problem—game theory predicts that Jack (or the first player) will choose to take on the very first move and both players will receive a $1 payoff.

Centipede Game

Chain-weighted CPI is an alternate measure for the Consumer Price Index that considers changes in consumer spending.

Chained Consumer Price Index For All Urban Consumers (C-CPI-U)

Chain-weighted CPI, or chained CPI, is an alternative measurement for the Consumer Price Index (CPI) that considers changes to consumer spending patterns to provide a more accurate picture of the cost of living based on the goods that consumers actually buy. In particular, from the government's point of view, using chain-weighted CPI rather than regular CPI to make cost of living adjustments to public benefits payments and marginal tax rate brackets results, respectively, in lower payments to beneficiaries and higher effective tax rates as tax payers incomes will creep in to higher tax brackets faster than upward adjustments to the brackets will be made. Chain-weighted CPI, or chained CPI, is an alternative measurement for the Consumer Price Index (CPI) that considers changes to consumer spending patterns to provide a more accurate picture of the cost of living based on the goods that consumers actually buy. Finally, the total effect of chain-weighted CPI adjustments is that it tends to be more stable and show a slower rate of increase in the cost of living (or as it is often misconstrued, the rate of inflation) over time compared to regular CPI. BLS points out that, because making these adjustments takes more time and relies on estimates of consumer behavior that have to be updated and revised later, chain-weighted CPI is a much less timely indicator that regular CPI.

Chain-Weighted CPI

Choke price is an economic term used to describe the lowest price at which the quantity demanded of a good is equal to zero.

Choke price is an economic term used to describe the lowest price at which the quantity demanded of a good is equal to zero. By using a demand schedule, or demand curve, a company can see where the choke price is as well as the differences in the quantity of a good that consumers will demand at different prices. This means that the choke price is never actually observed, but may be extrapolated from an econometrically estimated demand curve as the point where the demand curve (theoretically) intersects with the vertical axis on a supply and demand chart. Buyers are, of course, equally uninterested in any of the higher possible prices for the good, but the choke price is the lowest price at which there is zero demand. At any price below the choke price, consumers will demand some quantity of the good.

Choke Price

A theory that seeks to explain the effect that 24-hour news networks, such as CNN, have on the general political and economic climate. 

The CNN effect is a theory that 24-hour news networks, such as CNN, influence the general political and economic climate. If news consumers are not rational and the news is not true (or of unknown credibility), then it may not impact the functioning of markets for better or worse, though it could produce disastrous results, and would at best mean that any economic resources used in the production and dissemination of news are essentially wasted (aside from the value to consumers of consuming news as pure entertainment).
The CNN effect is really about the speed at which cable news was able to spread information and how that news seemingly made events far away matter to people that otherwise would not have noticed. The CNN effect—the theory that real-time information and prolonged focus on a particular event has a market impact—is still valid, but it may now be accurate to rename it the Twitter effect, rather than tying it back to a cable news channel. The CNN effect is a specific instance of a media effect and the cable news channel it is named for has since been eclipsed by the Internet and social media as the key source for real-time information. If the news is true, but news consumers are irrational, boundedly rational, or cognitively incapable of using the new information then supplying them with ever greater quantities of information at a faster rate may not improve the quality of their decisions and resulting market outcomes.

CNN Effect

Cognitive dissonance is the unpleasant emotion that results from believing two contradictory things at the same time.

Cognitive dissonance is the unpleasant emotion that results from holding two contradictory beliefs, attitudes, or behaviors at the same time. The person experiencing the dissonance will work to resolve one of the conflicting beliefs in order to reduce or eliminate the cognitive dissonance so their thoughts are once again linear and rational. She may resolve this cognitive dissonance by changing her belief in climate change, by adding a new belief that she is more important than other people in some way and that this justifies her out-sized carbon footprint, or by deciding that the danger of climate change is simply not that important to her. People can resolve cognitive dissonance by changing their existing beliefs, adding new beliefs, or reducing the importance of beliefs. The failure to resolve cognitive dissonance can lead to irrational decision-making as a person contradicts their own self in their beliefs or actions.

Cognitive Dissonance

The conflict theory states that society is in a constant state of conflict due to competition for limited resources. 

Max Weber, The Protestant Ethic and the Spirit of Capitalism. 1905

The Urban Housing Problem: Marxist Theory and Community Organizing

Conflict theory, first purported by Karl Marx, is a theory that society is in a state of perpetual conflict because of competition for limited resources. Conflict theorists of the later 20th and 21st centuries have continued to extend conflict theory beyond the strict economic classes posited by Marx, although economic relations remain a core feature of the inequalities across groups in the various branches of conflict theory. With the rise of capitalism, Marx theorized that the bourgeoisie, a minority within the population, would use their influence to oppress the proletariat, the majority class.﻿﻿ This way of thinking is tied to a common image associated with conflict theory-based models of society; adherents to this philosophy tend to believe in a pyramid arrangement in terms of how goods and services are distributed in society; at the top of the pyramid is a small group of elites that dictate the terms and conditions to the larger portion of society because they have an out-sized amount of control over resources and power. Conflict theorists assume that competition is the default (rather than cooperation).
Given conflict theorists' assumption that conflict occurs between social classes, one outcome of this conflict is a revolutionary event. Conflict theory, first purported by Karl Marx, is a theory that society is in a state of perpetual conflict because of competition for limited resources.

Conflict Theory : A Guide With Examples

Consumer sentiment is an economic indicator that measures how optimistic consumers feel about their finances and the state of the economy.

National Income and Product Accounts Tables

Consumer sentiment is a statistical measurement of the overall health of the economy as determined by consumer opinion. It takes into account people's feelings toward their current financial health, the health of the economy in the short-term, and the prospects for longer-term economic growth, and is widely considered to be a useful economic indicator.
Consumer sentiment emerged as an economic statistic during the mid-20th century and has since become a barometer that influences public and economic policy. Consumer sentiment is primarily measured through the Consumer Confidence Index (CCI) and the Michigan Consumer Sentiment Index (MCSI).
In the U.S., consumer spending makes up a majority of economic output. Two key measures that express consumers' feelings about the economy and their subsequent plans to make purchases are the Consumer Confidence Index (CCI), prepared by the Conference Board (CB), and the Michigan Consumer Sentiment Index (MCSI), conducted by the University of Michigan. Consumer sentiment was developed as an economic statistic during the mid-20th century and has since gone on to influence public and economic policy.

Consumer Sentiment

Consumer spending is the amount of money spent on consumption goods in an economy.

Key Economic Indicators Every Investor Should Know

Consumer spending is the total money spent on final goods and services by individuals and households for personal use and enjoyment in an economy. Consumer spending is all spending on final goods and services for current personal and household use. Consumer spending can be regarded as complementary to personal saving, investment spending, and production in an economy. Contemporary measures of consumer spending include all private purchases of durable goods, nondurable goods, and services. Income retained for future spending is called saving, which also funds investment in the production of future consumer goods.

Consumer Spending

The Consumer Price Index For All Urban Consumers measures the changes in the price of a basket of goods and services purchased by urban consumers. 

Spending Habits of Urban Consumers and "Blue-Collar"Consumers Living in Urban Areas, 1984 and 2015

Attachment F: Experimental CPI for Americans 62 Years of Age and Older

The Consumer Price Index For All Urban Consumers (CPI-U) measures the changes in the price of a basket of goods and services purchased by urban consumers. The CPI-U is also used to adjust other economic series for price change and to translate those series into inflation-free dollars.
The CPI-U and its other CPI components are also used as a means for indexing populations. The CPI-U was introduced in 1978 and is representative of the buying habits of approximately 80% of the non-institutional population of the United States, compared with 32% represented in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). The Consumer Price Index For All Urban Consumers (CPI-U) measures the changes in the price of a basket of goods and services purchased by urban consumers. The Consumer Price Index For All Urban Consumers (CPI-U) measures the changes in the price of a basket of goods and services purchased by urban consumers.

Consumer Price Index For All Urban Consumers (CPI-U)

People born before 1985 and who have adopted technology at a point later in life are considered to be digital immigrants. 

A digital immigrant is a person who was raised prior to the digital age. The idea of the digital immigrant grew from the complaint that teachers were having a hard time communicating with the newer generation due to a technology gap; students who were digital natives were speaking a different language than their older, digital immigrant teachers. As many digital immigrants discover when they interact with their younger counterparts, a language barrier exists between the two groups because of how much easier it is for digital natives to quickly learn any new technology introduced to them. A digital immigrant is a person who grew up before the internet and other digital computing devices were ubiquitous—and so have had to adapt and learn these technologies. The digital age is also known as the new media age, the computer age, and the information age.

Digital Immigrant

Diner's dilemma is a situation where several people agree to split the bill before going out to eat and order higher-priced items than they normally would.

Diner's dilemma is a game-theory situation with several players in which they each inadvertently end up sabotaging themselves and each other. Game theory and experimental evidence both suggest that people will tend to choose a more expensive meal for themselves, knowing that part of the cost will be born by other players, but that this ends up leaving all the players worse off by paying more than they would have wanted to.
The diner’s dilemma is related to the prisoner’s dilemma, the tragedy of the commons and the free rider problem, and can be resolved by similar formal and informal institutional strategies.
The diner's dilemma is based on a situation where several people agree to split the bill before going out to eat. Or groups of people who repeatedly engage in diner’s dilemma type interactions over time could evolve informal institutional solutions, such as increased levels of trust between group members, which encourages more cooperative choices.
The diner’s dilemma is a common situation that many people have probably experienced or witnessed, even if they never realized there was a name for this chain of events. The diner’s dilemma is a game theory scenario that occurs when players agree to split the cost of a common meal but individually choose the value and cost of their own order. This happens in a tragedy of the commons when people seek to maximize their consumption of a free natural resource at the expense of every other individual, when there is no way to exclude anyone from consuming, or in a free rider problem when people consume more of a good than they pay for because they are not compelled to pay individually.

Diner's Dilemma

Discounting mechanism is the premise that the stock market takes into account all available information including present and potential future events.

A discounting mechanism operates on the premise that the stock market essentially discounts, or takes into consideration, all available information including present and potential future events. The efficiency of the stock market as a discounting mechanism has been vigorously debated over the years, as there have been cases where the market has moved in the opposite direction as the economy. A discounting mechanism operates on the premise that the stock market essentially discounts, or takes into consideration, all available information including present and potential future events. The discounting mechanism theory suggests that when the economy grows, there's a good chance the stock market will also show gains. Discounting mechanisms rely on the premise that the stock market essentially discounts all available information including present and potential future events.

Discounting Mechanism

A dollar auction is a non-zero-sum sequential game where the highest bidder receives a dollar and the loser must pay the amount that they bid as well.

Designed by economist Martin Shubik, a dollar auction is a game that illustrates a paradox of rational choice theory which assumes that a person will always make the most logical decision. For example, if an auction leads to Participant A bidding 90 cents, followed by a $1 bid from Participant B, Participant A can either offer $1.01 and lose 1 cent or drop out of the auction and lose 90 cents.
Bidding more than a dollar for a dollar is not logical. A dollar auction is a simple game, where two participants bid on a dollar bill. Designed by economist Martin Shubik, a dollar auction is a game that illustrates a paradox of rational choice theory which assumes that a person will always make the most logical decision. A dollar action is a simple game, where two participants bid on a dollar bill.

Dollar Auction

The Dutch Book Theorem, a probability theory, states that profit opportunities will arise when inconsistent probabilities are assumed in a given context.

The Dutch Book Theorem is a type of probability theory that postulates that profit opportunities will arise when inconsistent probabilities that violate the Bayesian approximation are assumed in a given context. If the insurance company predicts that the probability that a homeowner will need insurance is 5%, but all homeowners predict that the probability of needing insurance is 10%, then the insurance company can charge more for home insurance. The Dutch Book Theorem is often associated with gambling and enables professional bettors to avoid losses.
The assumed probabilities can be rooted in behavioral finance, and are a direct result of human error in calculating the probability of an event occurring. The Dutch Book Theorem is a type of probability theory that postulates that profit opportunities will arise when inconsistent probabilities that violate the Bayesian approximation are assumed in a given context. The Dutch Book Theorem is a probability theory which states that profit opportunities will arise when inconsistent probabilities are assumed in a given context.

Dutch Book Theorem

An echo bubble is a post-bubble rally that becomes another, smaller bubble in the same sector or market where the first one occurred.

An echo bubble is a post-bubble market rally that results in another, smaller bubble. The echo bubble occurs in the sector or market in which the preceding bubble was most prominent, but the echo bubble is less inflated and thus, if it also bursts or deflates, will leave relatively less damage behind. An echo bubble is a follow-on price bubble that occurs after a larger market bubble bursts. An echo bubble is a post-bubble market rally that results in another, smaller bubble. Despite their smaller magnitude, echo bubbles can greatly intensify negative sentiment and pessimism in markets as they burst and reveal greater damage than market participants may have originally perceived.
Nobel Prize recipient Vernon Smith identified the occurrence of echo bubbles in laboratory experiments where test subjects bid on the price of an asset.

Echo Bubble

The Einhorn effect is the sharp drop in a company’s share price that often occurs after investor David Einhorn publicly shorts that company’s stock. 

Allied Capital Tumbles on Fund Manager's Critique

Order Instituting Cease-and-Desist Proceedings, Making Findings, and Imposing a Cease-and-Desist Order Pursuant to Section 21C of the Securities Exchange Act of 1934

THE DAVID EINHORN EFFECT AND ITS LIMITATIONS

Einhorn raises Chipotle concerns and shares sink

Einhorn’s hedge fund gained only 1.6% last year

UPDATE 1-Greenlight's Einhorn bets on Brighthouse, makes money on GM

‘This Is Unbelievable’: A Hedge Fund Star Dims, and Investors Flee

Hedge fund all-star David Einhorn posts his worst year ever, losing 34% in 2018

David Einhorn Has Made a Lot of Bad Bets — And One Very Good One

Martin Marietta shares fall on Einhorn comments

David Einhorn Singlehandedly Crushed A Stock Today By Asking These Questions

Table of Contents
What Is the Einhorn Effect? The term Einhorn effect refers to the sharp movement of a public company's share price in response to comments or trading activity by hedge fund manager David Einhorn. The Einhorn effect is the sharp movement of a public company's share price in response to comments or trading activity by noted investor David Einhorn. Understanding the Einhorn Effect
The Einhorn Effect in Recent Years
Example of the Einhorn Effect The most famous example of the Einhorn effect was an 11% drop in the stock price of Allied Capital in 2012, a company that described itself as a business development firm.

Einhorn Effect

Emotional neutrality is the concept of removing greed, fear, and other human emotions from financial or investment decisions.

Emotional neutrality is the concept of removing greed, fear, and other human emotions from financial or investment decisions. When there is an overarching pessimistic sentiment on a stock, it may push the price so low that the downfalls and risks of the company's stock are overblown, thus leading to attractive buying opportunities.
Figuring out which distressed stocks to buy and selling them once the company recovers, thus boosting the stock value, is the major play for contrarian investors. The goal of emotional neutrality is to remove the psychological influence of emotion from the process of making objective financial decisions, so that the best possible decision can be made, regardless of whatever emotions those decisions may trigger. If investors are able to remove the impact that their emotions have on their trading decisions, proponents of emotional neutrality contend that doing so will result in improved trading performance. The rationale behind this strategy is that if investors are not emotionally neutral, their emotions will impact their trading decisions and thus under- or over-value securities, creating an opportunity for profit for contrarian traders.

Emotional Neutrality

The endowment effect refers to an emotional bias that causes individuals to value an owned object higher, often irrationally, than its market value.

The endowment effect refers to an emotional bias that causes individuals to value an owned object higher, often irrationally, than its market value. 2.  **Loss aversion**: This is the main reason that investors tend to stick with certain unprofitable assets, or trades, as the prospect of divesting at the prevailing market value does not meet their perceptions of its value.
People who inherit shares of stock from deceased relatives exhibit the endowment effect by refusing to divest those shares, even if they do not fit with that individual's risk tolerance or investment goals, and may adversely impact a portfolio's diversification. In behavioral finance, the endowment effect, or divestiture aversion as it is sometimes called, describes a circumstance in which an individual places a higher value on an object that they already own than the value they would place on that same object if they did not own it. If an offer were made at a later date to acquire that wine for its current market value, which is marginally higher than the price that the individual paid for it, the endowment effect might compel the owner to refuse this offer, despite the monetary gains that would be realized by accepting the offer. The endowment effect describes a circumstance in which an individual places a higher value on an object that they already own than the value they would place on that same object if they did not own it.

Endowment Effect

Experimental economics studies human behavior in a controlled setting, to test economic theories by seeing how people respond to incentives.

What Can Laboratory Experiments Teach Us About Emissions Permit Market Design?

Experimental economics is a branch of economics that studies human behavior in a controlled laboratory setting or out in the field, rather than just as mathematical models. Along with behavioral economics—which has established that people are a lot less rational than traditional economics had assumed—experimental economics is also being used to investigate how markets fail and to explore anticompetitive behavior. These market experiments, involving real people making real choices, are a way of testing whether theoretical economic models actually describe market behavior, and provide insights into the power of markets and how participants respond to incentives—usually cash. Experimental economics is a branch of economics that studies human behavior in a controlled laboratory setting or out in the field, rather than just as mathematical models. The field was pioneered by Vernon Smith, who won the Nobel Prize in Economics in 2002 for developing a methodology that allows researchers to examine the effects of policy changes before they are implemented to help policymakers make better decisions.

Experimental Economics

The fear and greed index was developed by CNNMoney to measure two of the primary emotions that influence how much investors are willing to pay for stocks.

Table of Contents
What Is the Fear and Greed Index?
How the Fear and Greed Index Works
Benefits CNNMoney developed a fear and greed index; however, there is also a crypto fear and greed index that was developed by the website Alternative.me. The CNN fear and greed index examines seven different factors to establish how much fear and greed there is in the market. For the CNN fear and greed index, seven different factors are graded to establish how much fear and greed there is in the market. The skeptics argue that a buy-and-hold strategy is the best way to invest in equities and worry that tools such as the fear and greed index encourage investors to frequently trade in and out of stocks.

Fear and Greed Index

Freeganism is an alternative philosophy of living, based on minimal participation in capitalism and limited consumption of resources.

Freegan Movement – Principles & Problems of Freeganism

What is a Freegan? What Your Business Can Learn from the Freeganism Movement

How Many Trees Does It Take To Make 1 Ton Of Paper?

Table of Contents
What Is Freeganism?
Understanding Freeganism
History of Freeganism
Freeganistic Practices
Freeganism in the Workplace
Limitations of Freeganism Some of the primary activities freegans seek to act against include animal cruelty, human rights abuse, and environmental destruction as well as capitalistic exploitations that create excessive competition, greed, production, over-consumption, and over-indulgence. Freeganism is an alternative philosophy for living, based on minimum participation in capitalism and conventional economic practices, as well as limited consumption of capitalistic resources. To satisfy their needs, freegans choose to use alternative living strategies, often foraging instead of buying, volunteering rather than working, and squatting as opposed to renting. The term freeganism first appeared in the mid-1990s, combining the behaviors of vegans—those who decline to buy animal-based products—with the philosophy of living a lifestyle free from modern capitalism.

Freeganism

The gambler's fallacy is an erroneous belief that a random event is less or more likely to happen based on the results from a previous event.

The gambler's fallacy, also known as the Monte Carlo fallacy, occurs when an individual erroneously believes that a certain random event is less likely or more likely to happen based on the outcome of a previous event or series of events. The gambler's fallacy, also known as the Monte Carlo fallacy, occurs when an individual erroneously believes that a certain random event is less likely or more likely to happen based on the outcome of a previous event or series of events. The gambler's fallacy consists of misjudging whether a series of events are truly random and independent, and wrongly concluding that the outcome of the next event will be the opposite of the outcomes of the preceding series of events. If before any coins were flipped a gambler were offered a chance to bet that 11 coin flips would result in 11 heads, the wise choice would be to turn it down because the probability of 11 coin flips resulting in 11 heads is extremely low. However, if the person knows that this is a fair coin with a 50/50 chance of landing on either side and that the coin flips are not systematically related to one another by some mechanism then they are committing the gambler's fallacy.

Gambler's Fallacy

Game theory is a framework for modeling scenarios in which conflicts of interest exist among the players.

Theory of Games and Economic Behavior: Overview

Game theory is a theoretical framework for conceiving social situations among competing players. **Information set**: The information available at a given point in the game (The term information set is most usually applied when the game has a sequential component.)
**Equilibrium**: The point in a game where both players have made their decisions and an outcome is reached
Nash equilibrium is an outcome reached that, once achieved, means no player can increase payoff by changing decisions unilaterally. The centipede game is an extensive-form game in game theory in which two players alternately get a chance to take the larger share of a slowly increasing money stash. Let's start by defining a few terms commonly used in the study of game theory:
**Game**: Any set of circumstances that has a result dependent on the actions of two or more decision-makers (players)
**Players**: A strategic decision-maker within the context of the game
* The focus of game theory is the game, which serves as a model of an interactive situation among rational players.

Game Theory

Gamification describes the incentivization of people's engagement in non-game contexts using game-style mechanics.

Gamification describes the incentivization of people's engagement in non-game contexts and activities by using game-style mechanics. Any time game-like features or aspects of game design are introduced to non-game contexts, gamification is taking place. Gamification describes the incentivization of people's engagement in non-game contexts and activities by using game-style mechanics. Poorly designed or implemented gamification can become a distraction from other priorities, encourage people to literally game the system, or result in players engaging in zero-sum or even negative-sum competition against one another. Gamification describes the incorporation of game-style incentives into everyday or non-game activities.

Gamification

The headline effect is the effect that negative news in the popular press has on a corporation or an economy. 

The Impact of the Sovereign Debt Crisis on the Eurozone Countries

The headline effect refers to the effect that negative news in the popular press has on a corporation or an economy. The headline effect refers to the observation that negative news tends to have a proportionally more pronounced effect on prices and markets than positive news. While this market reaction is, to some extent, natural and expected, the headline effect can speed up and worsen the severity of the market reaction by bringing bad news to the forefront of the trading public's mind. The headline effect refers to the effect that negative news in the popular press has on a corporation or an economy. Examples of the headline effect include the change in consumer discretionary spending resulting from gasoline price changes and the impact of the Greek debt crisis on the value of the euro.

Headline Effect

Homo economicus, or economic man, is the figurative human being characterized by the infinite ability to make rational decisions.

The Collected Works of John Stuart Mill, Volume IV - Essays on Economics and Society Part I

A Critical Review of Homo Economicus from Five Approaches

Prospect Theory: An Analysis of Decision under Risk

Homo economicus vs. Homo sociologicus: Do values influence actual behavior?

Table of Contents
What Is Homo Economicus? Understanding Homo Economicus
Origins of Homo Economicus
Traits of Homo Economicus
Homo Economicus Today
Limitations of Homo Economicus
Other Decision-Making Models
Example of Homo Economicus This assumes that individuals are conscious of making decisions based on their own self-interest, that individuals have relevant and full information so they can make a rational calculation that would maximize utility, and that the primary goal for companies is to maximize profits and for individuals, to maximize utility.
Companies accomplish this by adding to their workforce until a point where the value of the output balances the additional cost of hiring workers. Rationality should dictate that the rational business person should use profits from their business to live a fairly frugal existence but that is not always the case.
Homo economicus, or economic man, is the figurative human being characterized by the infinite ability to make rational decisions. In certain neoclassical economic theories, people are portrayed this way: as ideal decision-makers with complete rationality, perfect access to information, and consistent, self-interested goals.

Homo Economicus

Homogeneous expectations is a modern portfolio theory that assumes all investors expect the same and make identical choices in a given situation.

"Homogeneous expectations" refers to the assumption, expressed in Harry Markowitz's Modern Portfolio Theory (MPT), that all investors have the same expectations and make the same choices in a given situation. According to the theory, there are four steps involved in the construction of a portfolio:
1.  Security valuation: Describing various assets in terms of expected returns and risks
2.  Asset allocation: Distributing various asset classes within the portfolio
3.  Portfolio optimization: Reconciling risk and return in the portfolio
4.  Performance measurement: Dividing each asset's performance into market-related and industry-related classifications.
Homogeneous expectations are a core principle of MPT. It is an investment model designed to maximize returns while taking the lowest possible risk—MPT assumes that all investors are risk-averse and that risk is an inherent part of higher reward. According to homogeneous expectations, if investors are shown several investment plans with different returns at a particular risk, they will choose the plan that boasts the highest return. MPT categorizes investors as the same, suggesting that all of them want to maximize returns without taking on unnecessary risk, understand expected returns, do not factor in commissions when making decisions, and have access to the same information.

Homogeneous Expectations

The Human Development Index (HDI) is a tool developed by the United Nations to measure and rank countries' levels of social and economic development.

The Human Development Index (HDI) is a statistic developed and compiled by the United Nations to measure various countries' levels of social and economic development. In recognition of these facts, the Human Development Report Office (HDRO) provides additional composite indices to evaluate other life aspects, including inequality issues such as gender disparity or racial inequality.﻿﻿ Examination and evaluation of a country's HDI are best done in concert with examining these and other factors, such as the country's rate of economic growth, expansion of employment opportunities, and the success of initiatives undertaken to improve the overall quality of life within a country. The health aspect of the HDI is measured by the life expectancy, as calculated at the time of birth, in each country, normalized so that this component is equal to 0 when life expectancy is 20 and equal to 1 when life expectancy is 85. In the case of HDI, the inclusion of the components is problematic because it is easily plausible that higher average incomes directly lead to both more investment in formal education and better health and longevity, and definitions and measurement of years of schooling and life expectancy can vary widely from country to country. Evaluating a country's potential for individual human development provides a supplementary metric for evaluating a country's level of development besides considering standard economic growth statistics, such as gross domestic product (GDP).

Human Development Index (HDI)

Inflationary psychology is a state of mind that leads consumers to spend more quickly than they otherwise would in the belief that prices are rising.

Table of Contents
What Is Inflationary Psychology?
Behind Inflationary Psychology
Managing Inflationary Psychology
Example of Inflationary Psychology
Impact on Investments Some economists describe inflationary psychology simply as a normal response to rising prices, based on theories of adaptive expectations or rational expectations; that consumers form their expectations of future inflation based (respectively) on their observations of recent inflation and their mental models of how economic variables such as interest rates and monetary policy determine inflation. Inflationary psychology can become a self-fulfilling prophecy, because as consumers spend more and save less, the velocity of money increases, further boosting inflation and contributing to inflationary psychology. Inflationary psychology essentially refers to the apparently positive feedback between currently rising prices and consumers' expectations that prices will continue to rise in the future. Inflationary psychology refers to the role that investor, consumer, and other market participant psychology play in the process of inflation.

Inflationary Psychology

Intertemporal choice refers to decisions, such as spending habits, made in the near-term that can affect future financial opportunities.

Intertemporal choice is an economic term describing how current decisions affect what options become available in the future. Theoretically, by not consuming today, consumption levels could increase significantly in the future, and vice versa.
Intertemporal choice refers to decisions, such as spending habits, made in the near-term that can affect future financial opportunities. The individual might take out a personal loan, max out credit cards, or, when possible, even withdraw funds from retirement accounts in order to cover the expense.
Making such a choice would reduce the assets the individual has available to continue to save for retirement. For individuals, on the other hand, decisions made in the near-term that can affect future financial opportunities relate mostly to saving and retirement. It is common for people to make intertemporal choices that accommodate near-term needs and wants over long-term objectives.

Intertemporal Choice

An investment multiplier quantifies the additional positive impact on aggregate income and the general economy generated from investment spending.

The term investment multiplier refers to the concept that any increase in public or private investment spending has a more than proportionate positive impact on aggregate income and the general economy. The term investment multiplier refers to the concept that any increase in public or private investment spending has a more than proportionate positive impact on aggregate income and the general economy. Mathematically, the investment multiplier is a function of two main factors: the marginal propensity to consume (MPC) and the marginal propensity to save (MPS).
Consider the road construction workers in our previous example. The formula for calculating the investment multiplier of a project is simply:
1 / ( 1 − M P C ) 1 / (1 - MPC) 1/(1−MPC)
Therefore, in our above examples, the investment multipliers would be 3.33 and 10 for the workers and the businesses, respectively. The extent of the investment multiplier depends on two factors: the marginal propensity to consume (MPC) and the marginal propensity to save (MPS).

Investment Multiplier

Iterated prisoner's dilemma is played repeatedly by the same participants, and helps players learn about the behavioral tendencies of their counterparty.

The iterated prisoner's dilemma is an extension of the general form except the game is repeatedly played by the same participants. Based on the assumption that the game can model transactions between two people requiring trust, cooperative behavior in populations may be modeled by a multi-player, iterated version of the game. An iterated prisoner's dilemma differs from the original concept of a prisoner's dilemma because participants can learn about the behavioral tendencies of their counterparty. The iterated prisoner's dilemma game is fundamental to many theories of human cooperation and trust. The iterated prisoner's dilemma is an extension of the general form except the game is repeatedly played by the same participants.

Iterated Prisoner's Dilemma

The term January Barometer refers to the belief that the S&P 500's performance in January can predict its performance for the rest of the year.

The term January Barometer refers to the belief held by some traders that the investment performance of the S&P 500 in January can predict its performance for the rest of the year. If true, this could explain why the correlation between January and annual market returns is more prevalent in the U.S. than in other regions where the January Barometer theory is less well known. The term January Barometer refers to the belief held by some traders that the investment performance of the S&P 500 in January can predict its performance for the rest of the year. The January Barometer is a market theory stating that returns in January predict those for the rest of the year. Therefore, the January Barometer could just be a secondary effect of the general tendency of U.S. equities to creep higher each year, rather than a special phenomenon that can be used to further improve one’s market timing.

January Barometer

Karl Marx was a 19th-century philosopher, author, and economist famous for his ideas about capitalism and communism. He was the father of Marxism.

Capital A Critique of Political Economy Volume I Book One: The Process of Production of Capital

Table of Contents
Who Was Karl Marx?
Marx's Inspiration
Marx's Social Economic Systems
Marx's Historical Materialism
Using Marx as a Foundation
His Early Life
Personal Life
Famous Works
Contemporary Influence
The Labor Theory of Value
To Social Transformation While Marx's answer was eventually proved incorrect and later economists adopted the subjective theory of value, his simple assertion was enough to show the weakness of the labor theory's logic and assumptions; Marx unintentionally helped fuel a revolution in economic thinking. Marx understood the labor theory better than his predecessors (even Adam Smith) and contemporaries, and presented a devastating intellectual challenge to laissez-faire economists in _Das Kapital_: If goods and services tend to be sold at their true objective labor values as measured in labor hours, how do any capitalists enjoy profits? Marx, in conjunction with Friedrich Engels, published _The Communist Manifesto_ in 1848; later in life, he wrote _Das Kapital_ (the first volume was published in Berlin in 1867; the second and third volumes were published posthumously in 1885 and 1894, respectively), which discussed the labor theory of value.

Karl Marx : His Life, Theories, & Impact

Laissez-faire is an economic theory from the 18th century that opposes any government intervention in business affairs and translates to "leave alone".

Physiocracy and Free Trade in 18th-Century France

Turgot: The Man Who First Put Laissez-Faire into Action

Laissez-faire is an economic theory from the 18th century that opposed any government intervention in business affairs. Only at the beginning of the 20th century did developed industrialized nations like the U.S. begin to implement significant government controls and regulations to protect workers from hazardous conditions and consumers from unfair business practices; though it’s important to note that these policies were not intended to restrict business practices and competition. The 20th-century British economist John Maynard Keynes was a prominent critic of laissez-faire economics, and he argued that the question of market solution versus government intervention needed to be decided on a case-by-case basis. Laissez-faire is an economic theory from the 18th century that opposed any government intervention in business affairs. Laissez-faire is an economic philosophy of free-market capitalism that opposes government intervention.

Laissez-Faire

Late majority refers to the second to last segment of a population to adopt an innovative technology, and accounts for roughly 34% of the population. 

The Anatomy of Buzz: How to Create Word of Mouth Marketing

The "late majority" refers to the second to last segment of a population to adopt innovative technology as it diffuses through a society. The diffusion of technology can be broken into five segments: innovators who are the first to adopt, early adopters, early majority, late majority, and laggards. The adoption of groundbreaking products can be broken into five segments: innovators (who are the first to adopt), early adopters, early majority, late majority, and laggards. In fact, the early adopters are the easiest for companies to capture as long as their product is innovative enough, but both the early majority and late majority require better value propositions. The early adopters and the early majority are younger, more familiar with technology in general, and value it enough to spend the money at an early stage.

Late Majority

The lipstick effect is a theory that spending on small indulgences such as premium lipstick increases during periods of recession.

Table 2.4.5U. Personal Consumption Expenditures by Type of Product

The lipstick effect is when consumers still spend money on small indulgences during recessions, economic downturns, or when they personally have little cash. Economists break down consumer demand for any given product as a combination of the effects of the price of a good relative to other goods, known as the substitution effect, and the consumer's income, known as the income effect.
For normal goods, as a consumer's income rises, so does demand. As a result, the lipstick indicator helps the chair of Estée Lauder know how to plan his budget, but it’s of no practical use to a regular mom-and-pop investor, unless they also can easily track lipstick sales. Sales of small luxury items can be used as an indicator of economic recessions based on the lipstick effect. The lipstick effect describes the observation that consumers will still tend to buy small luxury items even during an economic downturn.

Behavioral Economics

More in Economy

Terms in Behavioral Economics

Adaptive Selling

Adopter Categories

All-Pay Auction

Anchoring and Adjustment

Animal Spirits

Backward Induction

Bandwagon Effect

Base Rate Fallacy

Behavioral Modeling

Behavioral Economics