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

2020 ◽  
Author(s):  
Shirley Zhang ◽  
Abigail B Sussman ◽  
Christopher K Hsee
Keyword(s):  
Price Increase ◽  
Unit Price ◽  
Current Work ◽  
Policy Makers ◽  
Consumer Decisions ◽  
Price Increases ◽  
Acceptable Range ◽  
Purchase Quantity

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.

scholarly journals Analysis of price fairness toward work quality and user satisfaction for architectural network

2019 ◽  
Vol 258 ◽  
pp. 02023
Author(s):  
Amalia N. Farini ◽  
Arief S.B. Nugroho
Keyword(s):  
User Satisfaction ◽  
Research Data ◽  
Price Increase ◽  
Unit Price ◽  
Price Fairness ◽  
Work Quality ◽  
Direct Assessment ◽  
Price Increases ◽  
Spss Software

Construction business is still considered as a prominent business in the entire cities in Indonesia, including Yogyakarta. Contractors compete to get project either by tender or direct order. Both methods will certainly affect the price offered by the contractors. The research aims to understand how big the price gap between tender method and direct order for architectural works along with the work quality and the owner’s satisfaction. Furthermore, several buildings in Yogyakarta become the sample of this research. The research data were collected using questionnaire, direct assessment, as well as direct interview with the contractors. The data obtained were analysed descriptively and statistically using SPSS software. The price gap between tender and direct order is 0,42% more expensive tender. On the tender method, the unit price increases followed by the increase in quality and user satisfaction. On direct order work, the price increase is followed by the increase in quality but decreased satisfaction.

Fuel price increase, subsidies, overcapacity, and resource sustainability

2008 ◽  
Vol 65 (6) ◽  
pp. 832-840 ◽  
Author(s):  
Ussif Rashid Sumaila ◽  
Louise Teh ◽  
Reg Watson ◽  
Peter Tyedmers ◽  
Daniel Pauly
Keyword(s):  
Price Increase ◽  
Positive Aspect ◽  
Significant Component ◽  
Fuel Price ◽  
Fuel Prices ◽  
Resource Sustainability ◽  
Price Increases ◽  
Fishing Sector ◽  
Fuel Subsidies ◽  
Fuel Costs

Abstract Sumaila, U. R., Teh, L., Watson, R., Tyedmers, P., and Pauly, D. 2008. Fuel price increase, subsidies, overcapacity, and resource sustainability. – ICES Journal of Marine Science, 65: 832–840. Global fisheries are currently overcapitalized, resulting in overfishing in many of the world’s fisheries. Given that fuel constitutes a significant component of fishing costs, we expect recent increases in fuel prices to reduce overcapacity and overfishing. However, government fuel subsidies to the fishing sector reduce, if not completely negate, this positive aspect of increasing fuel costs. Here, we explore the theoretical basis for the expectation that the increasing fuel prices faced by fishing enterprises will reduce fishing pressure. Next, we estimate the amount of fuel subsidies to the fishing sector by governments globally to be in the range of US$4.2–8.5 billion per year. Hence, depending on how much of this subsidy existed before the recent fuel price increases, fishing enterprises, as a group, can absorb as much as this amount of increase in their fuel budget before any conservation benefits occur as a result of fuel price increases.

When signal swamps substance: the effects of multi-unit discount’s positive and negative cues on sales

2017 ◽  
Vol 26 (7) ◽  
pp. 750-758
Author(s):  
Devon DelVecchio ◽  
Timothy B. Heath ◽  
Max Chauvin
Keyword(s):  
Laboratory Experiment ◽  
Single Unit ◽  
Design Methodology ◽  
Unit Price ◽  
Negative Effects ◽  
Volume Increase ◽  
Content Type ◽  
Perishable Goods ◽  
Negative Effect ◽  
Purchase Quantity

Purpose Multi-unit discounts (MUDs, e.g. “3 for $4”) typically increase sales relative to other discounting frames. This study demonstrates the value of MUDs by showing that positive multi-unit price/quantity signals are potent enough to match and even exceed the sales produced by larger discounts on single items. However, there is reason to believe that MUDs can produce neutral effects in some cases (e.g. among consumers interested in only single-unit purchases) and even negative effects in others. In addition, the study considers whether MUDs can, in some cases, reduce purchase quantities by signaling smaller-than-otherwise-planned purchase amounts and/or lower-quality products. Design/methodology/approach The effectiveness of MUDs is tested in both the field and lab. Study 1 models purchase quantities stemming from 2,374 purchases of discounted items at a mass retailer. Purchased products ranged in type from pantry items to apparel and electronics, and ranged in price from 44¢ to $99.99. There were 1,530 single-unit discounts, 596 two-unit discounts and 248 discounts, involving three or more units. Study 2 consists of a laboratory experiment that overcomes the shortcomings of Study 1 by accounting for non-purchasers, controlling for product classes and testing whether smaller MUDs can lead to lower purchase quantities for larger-purchase-quantity products. Findings The results of both the field study and the laboratory experiment indicate that MUDs’ monetary cue (savings) and purchase-quantity cue (volume) increase purchase quantities. Generally, purchase quantities increased monotonically with the number of units offered in the discount. In fact, the quantity cue is so effective that it can increase sales enough as to substitute for larger discounts. However, in some instances, MUDs can decrease intended purchase quantities. The negative effect of MUDs is the most pronounced for larger unit deals, offering deeper discounts on perishable goods. Originality/value This research is the first to demonstrate that the power of the signals provided by MUDs may be so positive as to lead them to be more effective than discounts of substantially larger value but also so negative as to render them less effective than single-units discounts. This negative outcome poses a threat beyond those typically associated with discounts, in that rather than consumers simply discounting a discount, in which case the discount remains positive even if their impact at the margin wanes, the MUD frame may actually reduce sales.

scholarly journals The effects of alcohol pricing policies on consumption, health, social and economic outcomes, and health inequality in Australia: a protocol of an epidemiological modelling study

BMJ Open ◽  
2019 ◽  
Vol 9 (6) ◽  
pp. e029918 ◽  
Author(s):  
Heng Jiang ◽  
Robin Room ◽  
Michael Livingston ◽  
Sarah Callinan ◽  
Alan Brennan ◽  
...  
Keyword(s):  
Health Inequalities ◽  
Social Issues ◽  
Price Policy ◽  
Unit Price ◽  
Risky Drinking ◽  
Pricing Policy ◽  
Policy Makers ◽  
Policy Initiatives ◽  
Pricing Policies ◽  
The Impact

IntroductionAlcohol use and misuse are associated with substantial health and social issues in Australia and internationally. Pricing policy is considered as one of the most effective means to reduce risky drinking and related harms. This protocol paper describes a study that will model and estimate the effects, effectiveness and cost–benefit of alcohol pricing policy initiatives in reducing risky drinking, health and social harms, and health inequalities among subpopulations in Australia.Methods and analysisThe study is a modelling and epidemiological study using data from various resources, such as survey, previous literatures and response agencies. A number of statistical procedures will be undertaken to evaluate the impact of different alcohol pricing policy initiatives on various outcomes, including alcohol consumption in population subgroups, and health and social problems, and to measure health inequalities and cost-effectiveness of those proposed pricing policies, such as a 10% tax increase on all alcohol beverages or introduction of a minimum unit price.Ethics and disseminationThe ethics approval of this study was obtained from the College Human Ethics Sub-Committee of the La Trobe University on 9 November 2017 (Ref: S17-206). While examining the heterogeneous effects of price policy across population subgroups, this study will provide the first comprehensive estimates of the likely impacts of alcohol price changes on health inequalities. The study will also provide sophisticated economic analyses of the impact of price policy changes, which is critical information for policy makers and will assist policy makers in directing resources to a more efficient alcohol strategy. Results will be made available to communities and societies, health departments and other researchers.

Price, Scarcity, and Consumer Willingness to Purchase Pirated Media Products

2009 ◽  
Vol 28 (1) ◽  
pp. 71-84 ◽  
Author(s):  
Anthony D. Miyazaki ◽  
Alexandra Aguirre Rodriguez ◽  
Jeff Langenderfer
Keyword(s):  
Low Income ◽  
Academic Research ◽  
High Price ◽  
Future Research ◽  
Policy Makers ◽  
Consumer Decisions ◽  
Research Designs ◽  
Willingness To Purchase ◽  
Constraint Effects ◽  
Main Effects

Worldwide purchases of pirated media products continue to rise despite various industry and government efforts to quell their growth. Academic research examining consumer decisions underlying the purchase of pirated media has been limited in its approach by focusing almost exclusively on main-effects relationships and by using noncausal research designs. This article addresses these shortcomings by examining how various factors that consumers may perceive as constraining their ability to purchase genuine products (e.g., high price, stockouts, low income, lack of channel access, government restrictions) lead them to acquire pirated products and to condone such behavior in others. The authors report the results of three studies (two of which are experimental) that test three moderators of the consumption constraint effects using various settings, stimuli, and consumer types. The findings support the hypotheses that factors that may be perceived as limiting consumption can lead to higher piracy-related activity and are moderated by ethical beliefs, interpersonal social influence, and trait psychological reactance. The authors discuss the results in terms of implications for policy makers, managers, and future research opportunities.

Residential price elasticity of demand for water

2005 ◽  
Vol 5 (6) ◽  
pp. 183-188 ◽  
Author(s):  
S. Metaxas ◽  
E. Charalambous
Keyword(s):  
Water Use ◽  
Price Elasticity ◽  
Research Study ◽  
Price Increase ◽  
Income Levels ◽  
Elasticity Of Demand ◽  
Price Elasticity Of Demand ◽  
Price Increases ◽  
Residential Water Use ◽  
Residential Water

This paper presents an analysis on price elasticity of demand for water as a consequence of price increases. The objective of this research study is to estimate the residential price elasticities of demand for water for different regions, which may have different income levels. The general conclusion is that price elasticity for residential water use is inelastic (i.e. a given percentage of price increase results in a proportionally smaller decrease in quantity demanded) and it varies by consumer class and type of water use. The elasticity is not significantly affected by demographic and other factors.

scholarly journals Digital Archaeological Archiving in Israel

2021 ◽  
Author(s):  
Sveta Matskevich ◽  
Liat Weinblum
Keyword(s):  
Academic Community ◽  
Current Work ◽  
Data Loss ◽  
Policy Makers ◽  
Archaeological Data ◽  
Points Of View ◽  
Significant Data

In this article, the authors present two points of view on the preservation and dissemination of archaeological data in Israel: an official version of the policy makers (the Israel Antiquities Authority, henceforth IAA), and the view from the archaeological, especially academic, community outside the IAA. This includes an assessment of the strategies undertaken (or not) over the last 40+ years resulting in the majority of data being inaccessible, and documenting significant data loss since the 1990s. This is followed by current work to address these issues, including not only efforts to digitise but misconceptions about the problems digitisation both solves and creates, along with recommendations for how to approach the issues going forward.

Tobacco Price Increase and Successful Smoking Cessation for Two or More Years in Japan

2020 ◽  
Author(s):  
Keisuke Matsubayashi ◽  
Takahiro Tabuchi ◽  
Hiroyasu Iso
Keyword(s):  
Smoking Cessation ◽  
Confidence Interval ◽  
Odds Ratio ◽  
Adjusted Odds Ratio ◽  
Longitudinal Survey ◽  
Price Increase ◽  
National Longitudinal Survey ◽  
Middle Aged ◽  
Price Increases

Abstract Introduction Assessing long-term smoking cessation after tobacco price increases is more valuable than short-term cessation as smokers often relapse after temporary cessation. We investigated whether tobacco price increases were associated with long-term smoking cessation and whether the association differed according to demographic, socioeconomic, and behavioral factors, using a national longitudinal survey of middle-aged individual-level data from 10 waves, every November from 2005 to 2014. Methods Temporary and long-term at least 1 year (1y+) or 2 years (2y+) quitters were defined by smoking in any one wave and quitting in the subsequent two or three waves in a discrete-time design. November 2006 (after July 11% increase) and November 2010 (after October 37% increase) were used as proxy variables for price increases. Generalized estimating equation models adjusted for demographic, socioeconomic, and behavioral covariates, and analyses stratified by these covariates were performed to estimate the association between price increases and smoking cessation. Results Of 43 630 smokers aged 50–65, 7.7%, 5.6%, and 5.2% of smokers quit temporarily, for at least 1 year and at least 2 years, respectively. 2y+ quitters significantly increased in November 2005–November 2008 (adjusted odds ratio = 1.23, 95% confidence interval: 1.06–1.43) and November 2009–November 2012 (adjusted odds ratio = 1.85, 95% confidence interval = 1.57–2.16). In stratified analyses, higher prices were associated with 2y+ quitters in all subgroups with some exceptions, including participants who smoked 21–30 cigarettes per day and those aged 60–65. Conclusions Increasing tobacco prices may be effective in promoting long-term smoking cessation in various subgroups among middle-aged Japanese adults. Implications Few longitudinal studies have examined the effect of a tobacco price increase on long-term smoking cessation. In a national longitudinal survey of middle-aged Japanese from 10 waves, the 37% tobacco price increase was found to be a trigger for successful smoking cessation for two or more years. Price increases were significantly associated with 2y+ smoking cessation in most demographic, behavioral, and socioeconomic subgroups. Results indicate that higher tobacco prices may be effective for long-term smoking cessation in almost all subgroups. Raising tobacco taxes and prices may be one of the most effective strategies for promoting long-term smoking cessation.

scholarly journals Relationships between smoking duration, smoking intensity, hypothetical tobacco price increases, and smoking habit change intention among current smokers in Shanghai

2019 ◽  
Vol 47 (10) ◽  
pp. 5216-5228 ◽  
Author(s):  
Ruiping Wang ◽  
Yonggen Jiang ◽  
Xin Li ◽  
Qi Zhao ◽  
Meiying Zhu ◽  
...  
Keyword(s):  
Smoking Habit ◽  
Smoking Behavior ◽  
Cross Sectional Study ◽  
Retail Price ◽  
Price Increase ◽  
Chi Square ◽  
Cross Sectional ◽  
Smoking Intensity ◽  
Price Increases ◽  
Smoking Duration

Objectives We conducted a cross-sectional study to explore the effect of a hypothetical tobacco retail price increase on smoking habit change intention, and the role of smoking duration and intensity in smoking change intention. Methods In 2016 and 2017, we collected questionnaire data from 36,698 residents aged over 18 years in Songjiang district, Shanghai. Chi-square tests and weighted logistic regression were used for data analyses. Results The prevalence of current smoking was 19.78% (men: 48.36% and women: 0.22%). A total of 10.83% (men: 10.89% and women: 2.04%) and 9.39% of smokers (men: 9.42% and women: 6.12%) expressed the intention to smoke less or quit, respectively, given tobacco retail price increases. If the current tobacco retail price doubled, 75% of smokers stated that they would smoke less and 60% of smokers would consider quitting. Smokers with longer smoking duration and lower smoking intensity were more sensitive to tobacco price increases and more likely to change their smoking habits. Conclusions An increase in tobacco retail prices could induce some smokers to change their smoking behavior, particularly those with longer smoking duration and lower smoking intensity. A tobacco retail price increase is recommended, which should apply to all cigarette brands.

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