Phishing holidays: The market for timeshares

A recent book by Nobel laureates Akerlof and Shiller, Phishing for Phools, has drawn attention to the ‘dark side’ of the nudge. This article presents the timeshare market as an exemplar; a number of features of this market make it uniquely suitable for this purpose. I highlight the manner in which developers leverage consumer biases and cognitive limitations to secure sales. I then draw comparisons with the timeshare resale market to estimate the loss to consumers. I finish with some possible recommendations for reform.