A few people have asked me for a set of links on behavioural economics, consumer exploitation and regulation. We discuss this a lot in classes here and below are the main readings that I drew from this year.
The main readings I used for this topic (other than the obvious ones like Nudge and so on) are below
This set of lectures focused on ethics of nudging more generally are based on these.
I do a class on this paper from the Financial Conduct Authority. It details the various different biases and the implications for regulation. It is written for a policy audience but it complements the academic papers very well. I get the students to come up with other ways that companies can exploit behavioural biases and we debate the implications for regulation.
I also do a class on the paper below. It is really useful. It is basically about financial regulation but gives a lot of material about how industry can utilise choice manipulations and implications of this for policy.
See below for other useful readings on the area:
Mark Armstrong and John Vickers "Consumer protection and contingent charges". A later version of this is available in the Journal of Economic Literature.
The Office of Fair Trading investigation into fees for fitness clubs an interesting example of where a regulator specifically took action on a practice said to be exploiting consumer biases.
Huffman and Heidtke "Behavioral Exploitation Antitrust in Consumer Subprime Mortgage Lending"
Useful presentation by Maurice Stucke "Behavioral Exploitation and Its Implications on Competition and Consumer Protection Policies".
Stucke "Behavioural Antitrust and Monopolisation".