Modern pricing postulates: microeconomics in a complex world

The standard economic model as presented in virtually all undergraduate economics textbooks represents competition as occurring between a large number of individually small suppliers offering identical products to a market patronised by fully informed consumers. This model does not reflect common experience, and is not supported by econometric studies. A model of consumer choice in a market where most consumers will decline the great majority of offers is presented here. It is shown to be consistent with econometric measurements of deadweight loss and with common consumer experience. Certain policy and theoretical issues are discussed.