Dertwinkel-Kalt, M., Köhler, K., Lange, M.R.J. et al. (1 more author) (2017) Demand shifts due to salience effects: Experimental evidence. Journal of the European Economic Association, 15 (3). pp. 626-653. ISSN 1542-4766
Abstract
We conduct a laboratory experiment that tests two fundamental predictions unique to salience theory. If an agent purchases one of two vertically differentiated products, salience theory makes the following two distinct predictions. First, it hypothesizes that a higher expected price level for both products shifts demand toward the more expensive, high-quality product. Second, it predicts that demand for the high-quality product is larger if the price level is expectedly high than if it is unexpectedly high. In our experiment, subjects purchased fast or slow Internet access at different price levels. Our results strongly support both predictions of salience theory.
Metadata
Item Type: | Article |
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Authors/Creators: |
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Copyright, Publisher and Additional Information: | © 2017 The Authors. This is an author produced version of a paper subsequently published in Journal of the European Economic Association. Uploaded in accordance with the publisher's self-archiving policy. |
Dates: |
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Institution: | The University of Sheffield |
Academic Units: | The University of Sheffield > Faculty of Social Sciences (Sheffield) > Department of Economics (Sheffield) |
Depositing User: | Symplectic Sheffield |
Date Deposited: | 11 Oct 2018 08:06 |
Last Modified: | 27 Jan 2020 11:28 |
Published Version: | https://doi.org/10.1093/jeea/jvw012 |
Status: | Published |
Publisher: | Oxford University Press |
Refereed: | Yes |
Identification Number: | 10.1093/jeea/jvw012 |
Open Archives Initiative ID (OAI ID): | oai:eprints.whiterose.ac.uk:136965 |