Global Journal of Multidisciplinary and Applied Sciences

Behavioral Economics and Consumer Decision-Making in the Digital Marketplace

Hassan M. Farooq

Institute of Business Administration (IBA), Karachi, Pakistan

Sidra K. Malik

Hailey College of Commerce, University of the Punjab, Lahore, Pakistan

Keywords: behavioral economics, digital marketplace, consumer decision-making, nudges, heuristics and biases

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Abstract

Digital marketplaces have transformed consumer decision-making by embedding choices within high-speed, information-rich, and algorithmically curated environments. Behavioral economics provides a powerful lens to explain why consumers deviate from fully rational models—especially when facing choice overload, time pressure, persuasive interface design, and personalized recommendations. This article synthesizes core behavioral mechanisms—heuristics, biases, reference dependence, present bias, mental accounting, and social influence—and maps them to common digital marketplace features such as default settings, scarcity cues, pricing frames, subscription models, targeted advertising, and “one-click” purchasing. It also highlights emerging concerns including dark patterns, fairness in personalization, privacy trade-offs, and welfare impacts of platform nudges. The paper concludes with research directions and policy implications for designing choice architectures that improve consumer welfare while maintaining innovation and competition in digital commerce.