LLM Consumer Behavior Theory: Foundations of a Novel Research Field

2026-06-16

AI Summary

This study addresses the inadequacy of traditional consumer theory in explaining the emerging phenomenon of large language models (LLMs) acting as autonomous agents in consumption decisions. It proposes the first systematic theoretical framework for LLM-driven consumer behavior, integrating insights from classical and behavioral economics with natural language processing techniques to formally analyze how human preferences are expressed, processed, and aggregated into market demand through LLM proxies. The framework unifies previously fragmented research strands, exposes the limitations of standard assumptions—particularly rationality and homogeneity—in agent-mediated markets, and delineates key open questions concerning alignment mechanisms, preference representation, and market dynamics. By doing so, it establishes a foundational basis for future empirical and applied investigations into AI-mediated consumer behavior.

Abstract

Large language models (LLMs) are increasingly deployed as autonomous agents that make consumption decisions on behalf of users. This shift raises fundamental questions for consumer theory, which has traditionally modeled humans as the primary decision-makers. In this paper, we introduce LLM Consumer Behavior Theory, a new field of study concerned with analyzing consumer behavior in agentic markets. Drawing on classical and behavioral economics alongside recent advances in Natural Language Processing, we formalize how human preferences are reflected and acted upon by LLM-based agents, and how agent-level decisions aggregate into market demand. We unify previously fragmented literature on LLM decision-making, human behavior simulation, and preference elicitation under a common economic lens, highlighting where assumptions, such as rationality and heterogeneity, may fail in agentic markets. Rather than providing empirical validation, this paper outlines the scope of LLM consumer behavior and identifies open research questions related to alignment, preference representation, and market dynamics.

Problem

• LLM consumer behavior
• agentic markets
• preference representation
• market dynamics
• human-agent alignment

Innovation

• LLM Consumer Behavior Theory
• agentic markets
• preference representation
• market demand aggregation
• human-AI alignment