Introduction 1
1. The Law, Economics, and Psychology of Consumer Contracts 6
Introduction 6
Ⅰ. The Behavioral Economics of Consumer Contracts 7
Ⅱ. Welfare hnplications 23
Ⅲ. Market Solutions andTheir Limits 26
Ⅳ. Policy Implications: Disclosure Regulation 32
Conclusion 43
Appendix 44
2. Credit Cards 51
Introduction 51
Ⅰ. The Credit Card Market 56
Ⅱ. The Credit Card Contract 65
Ⅲ. Rational-Choice Theories and Their Limits 75
Ⅳ. A Behavioral-Economics Theory 78
Ⅴ. Welfare Implications 97
Ⅵ. Market Solutions 101
Ⅶ. Policy Implications: Rethinking Disclosure 105
Conclusion 112
Appendix: Teaser Rates 113
3. Mortgages 116
Introduction 116
Ⅰ. The Subprime Mortgage Market 128
Ⅱ. The Subprime Mortgage Contract 135
Ⅲ. Rational-Choice Theories and Their Limits 146
Ⅳ. A Behavioral-EconomicsTheory 156
Ⅴ. Welfare Implications 166
Ⅵ. Policy Implications 174
Conclusion 183
4. Cell Phones 185
Introduction 185
Ⅰ. The Cell Phone and the Cellular Service Market 194
Ⅱ. The Cellular Service Contract 205
Ⅲ. Explaining the Cellular Service Contract 212
Ⅳ. Welfare Implications 229
Ⅴ. Market Solutions 233
Ⅵ. Policy Implications 238
Conclusion 246
Conclusion 248
Bibliography 251
Index 269