Nudging generosity in consumer elective pricing

Silvia Saccardo, Charis X. Li, Anya Samek and Ayelet Gneezy

Organizational Behavior and Human Decision Processes, 2021, vol. 163, issue C, 91-104

Abstract: Consumer elective pricing (CEP)—allowing each consumer to decide how much to pay for a product or service—is becoming widespread. Organizations using this pricing scheme for both commercial and non-profit purposes have adopted a wide variety of phrasings to communicate it. In this paper, we propose that seemingly negligible differences in the phrasing of CEP can increase payments and donations. In three field experiments in both charitable and commercial marketplaces, we vary the language used to describe a CEP appeal to either highlight the social aspect of the exchange or not. Our findings show that CEP phrasing that cues the social nature of the transaction elicits socially oriented considerations and nudges generosity in both non-profit and for-profit markets. Follow-up online studies shed light on consumers’ perceptions under different CEP phrasing and establish a potential boundary condition.

Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jobhdp:v:163:y:2021:i:c:p:91-104

DOI: 10.1016/j.obhdp.2020.01.009

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