The Presence of Reference Price: How Value Can Appear Convergent to Buyers and Sellers

Shin-chieh Chuang, a Department of Business Administration, Chao-yang University of Technology ,Taiwan

The Presence of Reference Price: How Value Can Appear Convergent to Buyers and Sellers

 

Chien-Huang Lin, National Central University

Shin-Chieh Chuang, Chao-yang University of Technology

Chaang-Yung Kung, Chao-yang University of Technology

 

Abstract

This paper argues that the endowment effect­­­--the tendency of minimum selling price to exceed maximum buying price for a particular object--might be minimized when a reference price appears. The findings from 418 participants in two experiments support our hypothesis: the endowment effect would be smaller when the reference price is available. The importance of reference price is thus highlighted.
[ to cite ]:
Shin-chieh Chuang (2006) ,"The Presence of Reference Price: How Value Can Appear Convergent to Buyers and Sellers", in NA - Advances in Consumer Research Volume 33, eds. Connie Pechmann and Linda Price, Duluth, MN : Association for Consumer Research, Pages: 237-241.