Do consumers ever learn? Analysis of segment behavior in experimental markets

Economists argue that, despite cognitive limitations, economic agents arrive at optimal choice rules by learning. The assumption is that consumers, for example, are adaptively rational. Adaptive rationality raises a host of issues. We address three of these in the context of experimental markets: do consumers differ on the basis of learning; how do these differences, when aggregated, affect market efficiency; and how do consumers learn? Analysis of our experimental data reveals the following. First, multiple segments of consumers exist on the basis of learning. Second, the largest segment consists of subjects who do not learn despite timely feedback and motivation. Third, although some consumers do learn to make optimal choices, the effect of this segment on market efficiency is cancelled by an equal number of subjects who ‘learn' false relations. Finally, although subjects do not learn strict rationality even with experience, they are in the aggregate not so irrational as to allow highly suboptimal brands to survive. Further analysis of how consumers learn, specifically on the cues (signals) and the rules consumers employ in making choices over time leads to the following two conclusions. First, some signals make learning more easy than others: for example, providing market share information improves learning but not as much as providing quality information does. Second, people employ different rules depending upon the type of information they have. For example, consumers making decisions based only on price information are more likely to use a heuristic like ‘buy a medium‐priced product provided it has not failed in the past'. Consumers making decisions based on price and quality information may employ a heuristic such as ‘buy top quality products regardless of price'. We discuss the implications of these findings for theory and practice. Copyright © 2000 John Wiley & Sons, Ltd.     

Responding to regional labour demand: International migration and labour markets in New Zealand’s regions

New Zealand, like Australia and Canada, has long had an active policy of seeking immigrants to “grow” its population and economy. Unlike the other two countries, New Zealand does not have a federal system of government, and the absence of a state or provincial level of legislative authority has meant that policies to promote immigration and to meet labour market needs have been centrally driven. In the latter decades of the twentieth century, labour market activation policies in New Zealand were focussed on supply, including the engagement or re-engagement of workers. In the early years of the twenty-first century, there have been significant labour shortages, particularly (but not only) of skilled labour in a range of industries and regions, as well as changes in the nature of labour market engagement associated with the rise of various forms of non-standard employment. The policy focus has been increasingly demand-focussed and driven by local labour market considerations. It has also increasingly revolved around recruiting immigrant labour in response to local skill shortages. This paper discusses the way in which regions in New Zealand have developed schemes that are designed to attract immigrant labour to meet local labour demand as well as provide a key driver in local economic development.     

Metropolitan migration in the past: Labour markets, commerce, and cultural interaction in Europe, 1600–1914

This article challenges the “imaginary ethnography” of European urban population as monocultural and non-migrating. Pre-1800 European migrations are discussed first, next changing patterns in the 19th century are summarized. In the third section immigration to industrializing cities at the height of nationalism is exemplified by Czech migration to Vienna, Polish migration to the cities of the Ruhr District, and the multicultural and immigrant character of Budapest and of Paris. Immigrant insertion, conflict, migrants, and economic niches, as well as the reaction of host societies and community formation are discussed. In conclusion, older theories of disorganization are contrasted with recent concepts of acculturation and transcultural lives.