The Effects of Recommended Retail Prices on Consumer and Retailer Behaviour
Bibliographic Data
| ID | 9725402 |
|---|---|
| Authors | Lisa Bruttel (0000-0002-1322-210X, University of Potsdam, corresponding author) |
| Year | 2018 |
| Volume | 85 |
| Issue | 339 |
| Pages | 649-668 |
| Publication date | 2018-07-01 |
| Peer Reviewed | Yes |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | Economica (JOURNAL) |
| Journal identifiers | ISSN: 0013-0427 • E-ISSN: 1468-0335 |
| Publisher | Wiley (PUBLISHER • GB) |
| DOI | 10.1111/ecca.12218 |
| OpenAlex | W2560210828 |
| Language | EN |
| References cited | 16 |
This paper presents results from an experiment on the effects of recommended retail prices on consumer and retailer behaviour. We present evidence that recommended retail prices, despite their non‐binding nature, influence consumers’ willingness to pay by setting a reference point. At a given price, consumers buy more the higher the recommended retail price is, and their demand drops at prices above the recommended retail price, even when it is entirely uninformative about the value of the product. Retailers in this study are subject to similar anchoring effects, but they do not anticipate consumers’ behaviour well and are thus not able to exploit their behavioural biases
Business · Consumer behaviour · Consumer demand · Economics · Exploit · Microeconomics · Point (geometry) · Point of sale · Product (mathematics) · Value (mathematics) · Willingness to pay · Consumer Market Behavior and Pricing · Decision-Making and Behavioral Economics · Experimental Behavioral Economics Studies · Marketing
| Citation velocity | historical |
|---|---|
| Highly cited | No |