Document Type
Article
Publication Date
10-3-2022
Abstract
Commercial practices such as drip pricing, reference pricing and best-price guarantee can be used to set higher prices and mislead consumers, but protective measures can restore efficiency. In a placebo-controlled market experiment, we examined a treatment allowing for the use and misuse of commercial practices. Three additional treatments tested the effects of formal sanctions, informal sanctions and a regret nudge. We found that commercial practices led to higher prices, cheating was systematic and regret nudging was ineffective. Furthermore, formal and informal sanctions reduced both the likelihood of using commercial practices and the likelihood of cheating, leading to welfare increases.
Recommended Citation
Bogliacino, F., Charris, R., Codagnone, C., Folkvord, F., Montealegre, F., & Lupiáñez-Villanueva, F. (2022). Unfair commercial practices in a pit market: Evidence from an artefactual field experiment. Behavioural Public Policy, 1-18. https://doi.org/10.1017/bpp.2022.33
Peer Reviewed
1
Copyright
The authors
Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 License.
Comments
This article was originally published in Behavioural Public Policy in 2022. https://doi.org/10.1017/bpp.2022.33