EconPapers    
Economics at your fingertips  
 

A Dragging-Down Effect: Consumer Decisions in Response to Price Increases

Shirley Zhang, Abigail B Sussman, Christopher K Hsee, J Jeffrey Inman and RajeshBagchi

Journal of Consumer Research, 2021, vol. 47, issue 5, 772-786

Abstract: Four studies, across a range of domains, find a dragging-down effect in which consumers purchase fewer units of a product when a discount applies to more units. For example, consumers buy fewer peaches when each customer can buy up to three peaches at a discount than when each customer can buy only one peach at a discount or when there is no discount at all. In contrast to basic economic principles, this dragging-down effect implies that consumers purchase less (more) when the per-unit price is lower (higher). We propose and our results support an acceptability account: consumers will adopt the price-increase point (i.e., maximum discounted quantity) as their purchase quantity if that point falls within an acceptable range, and will ignore that point and purchase their initially preferred quantity instead if the price-increase point falls below the acceptable range. The current work enriches existing research on anchoring and pricing and carries implications for consumers, marketers, and policy-makers.

Keywords: price perception; discounts; reference prices; anchors; behavioral pricing (search for similar items in EconPapers)
Date: 2021
References: Add references at CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://hdl.handle.net/10.1093/jcr/ucaa031 (application/pdf)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:oup:jconrs:v:47:y:2021:i:5:p:772-786.

Access Statistics for this article

More articles in Journal of Consumer Research from Oxford University Press
Bibliographic data for series maintained by Oxford University Press ().

 
Page updated 2021-06-15
Handle: RePEc:oup:jconrs:v:47:y:2021:i:5:p:772-786.