Pay What You Want – But Pay Enough! Information Asymmetries and PWYW-Pricing

Matthias Greiff, Henrik Egbert () and Kreshnik Xhangolli ()
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Kreshnik Xhangolli: University of Applied Science

MAGKS Papers on Economics from Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung)

Abstract: Pay What You Want (PWYW) pricing has received considerable attention recently. Empirical studies show that if PWYW pricing is implemented, in a number of cases consumers do not behave selfishly and that some producers are able to use PWYW for increasing turnover and profits respectively. In this paper we add information asymmetries to the existing explanations regarding consumer behavior and argue that information asymmetries may account for the results found in empirical studies. Since the success of PWYW pricing depends on the distribution of information, one implication is that optimization strategies with respect to pricing should take information asymmetries into account.

Pages: 15 pages
Date: 2013
New Economics Papers: this item is included in nep-mkt
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Citations: View citations in EconPapers (3)

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Related works:
Journal Article: Pay What You Want – But Pay Enough! Information Asymmetries and PWYW Pricing (2014)
Working Paper: Pay What You Want – But Pay Enough! Information Asymmetries and PWYW Pricing (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:mar:magkse:201304

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