When quality is hard to evaluate, people often use price as a proxy, resulting in the “price-quality” heuristic. In a field experiment in a winery, the authors show that increasing the price of a high-quality wine, but not the low-quality one, may produce a significant increase in demand and profits, indicating an upward-sloping demand function.
Ayelet Gneezy and Uri Gneezy (2011) ,"Price-Based Expectations", in NA - Advances in Consumer Research Volume 38, eds. Darren W. Dahl, Gita V. Johar, and Stijn M.J. van Osselaer, Duluth, MN : Association for Consumer Research.
Ayelet Gneezy, University of California at San Diego, USA
Uri Gneezy, University of California at San Diego, USA
NA - Advances in Consumer Research Volume 38 | 2011
Time and Space for Robots and AI
Marat Bakpayev, University of Minnesota Duluth, USA
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