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

Matthias Greiff, Henrik Egbert () and Kreshnik Xhangolli

MPRA Paper from University Library of Munich, Germany

Abstract: Pay What You Want (PWYW) pricing has received considerable attention recently. Empirical studies show that when PWYW pricing is implemented buyers do not behave selfishly in a number of cases and that some sellers are able to use PWYW to increase turnover as well as profits. In this paper we present a theoretical model of buyer behavior under asymmetric information about production costs. Our model shows that information asymmetries provide an explanation for the results found in empirical studies.

Keywords: PWYW pricing; information asymmetry; fairness; buyer behavior (search for similar items in EconPapers)
JEL-codes: D4 M2 M3 (search for similar items in EconPapers)
Date: 2013-12-12
New Economics Papers: this item is included in nep-cta, nep-exp, nep-hme, nep-mic and nep-mkt
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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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:pra:mprapa:52766

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