How common is price irrationality? That's a question that really doesn't have an answer, of course, but there's no question that it happens all too frequently.
Another difficult question is this: What exactly is price irrationality? It's difficult to define, especially since it takes different forms, but it's easy enough to recognize when it happens.
Here are a few of the forms it assumes:
- Suppose a shopper arrives at a store intending to spend within a certain pri