Rain Drops Keep Falling on My Convertible
In a forthcoming paper in the Quarterly Journal of Economics, Meghan Busse and her co-authors ask if weather conditions affect car purchasing decisions. They find that the choice to purchase a 4x4 or convertible is highly dependent on weather conditions at the time of purchase, which is inconsistent with classical utility theory. Psychological biases such as projection bias and salience seem to explain their findings. The paper is available here.