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fubarobfusco comments on Econ/Game theory question - Less Wrong Discussion

12 Post author: Psychohistorian 11 May 2011 08:17PM

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Comment author: fubarobfusco 11 May 2011 09:16:08PM 2 points [-]

How much money does A have? What are her other options for how to use it? How much would it cost to move? It's extremely uncommon for people to be in a situation where they have no choice but to deal with a monopolist; indeed, that pretty much only occurs as the result of outside-the-market constraints such as regulation.

Comment author: wedrifid 11 May 2011 10:10:06PM 0 points [-]

Replace dollars with utilons. That automagically incorporates all of those considerations into the utilon calculation we are provided.