Explaining The Imperfections
Mail rebate coupons act as promotion tools for most monopolistic sellers. They succeed in promoting sales at a low cost due to low recovery rates (Living Economics: Rebate Coupons, 2020). Although they onerous filling of requirements and procrastination may discourage the buyers, rebate coupons entice more customers since the return value is big enough, invite more buyers (Living Economics: Rebate Coupons, 2020). Monopolistic sellers like manufacturers commonly use the mail rebate coupons and end up offering discounts to such buyers even if it were to lead to price inconveniences (Living Economics: Rebate Coupons, 2020). For instance, it’s expensive to implement the redemption hurdles required to limit discount customers who are more price sensitive. It might be an inferior solution for monopolistic sellers, but it is a stable solution for the prisoner’s dilemma game (Living Economics: Rebate Coupons, 2020). Additionally, rebate coupons help to reduce the number of goods to return.
A person will want to eat less but lack the strength to do so because mouthwatering foods are readily obtainable. Consequently, one will pay a lot of money to join a weight loss camps. The trend of reducing future benefits and costs give rise to urge-control problems which will require a diversity of strategies to solve them (Camerer, Loewenstein, Rabin and Camerer, 2011). People will try to limit the number of delicacies they put in hand to anticipate their overeating desires. To beat down their desires to acquire money from their accounts, they tend to register in deduction saving policies (Camerer, Loewenstein, Rabin and Camerer, 2011). Many will pay dollars to attend the weight-loss camps because they make alluring edibles less accessible. The self-control method may be effective but not perfect (Camerer, Loewenstein, Rabin and Camerer, 2011). Traditional economic urges people to eliminate regrets for having overeaten, drunk excessively or saving too little for they are sour grapes. Behavioural evidence, however, advocates that the regrets are logical since the affected forewent an available better option to an inferior one (Camerer, Loewenstein, Rabin and Camerer, 2011).
References
Camerer, C., Loewenstein, G., Rabin, M. and Camerer, C., 2011. Advances In Behavioral Economics. Princeton: Princeton University Press.
Livingeconomics.org. 2020. Living Economics: Rebate Coupons. [online] Available at: <https://livingeconomics.org/article.asp?docId=305> [Accessed 4 May 2020]