American Economic Review
ISSN 0002-8282 (Print) | ISSN 1944-7981 (Online)
Pavlovian Processes in Consumer Choice: The Physical Presence of a Good Increases Willingness-to-Pay
American Economic Review
vol. 100,
no. 4, September 2010
(pp. 1556–71)
Abstract
This paper describes a series of laboratory experiments studying whether the form in which items are displayed at the time of decision affects the dollar value that subjects place on them. Using a Becker-DeGroot auction under three different conditions — (i) text displays, (ii) image displays, and (iii) displays of the actual items — we find that subjects' willingness-to-pay is 40-61 percent larger in the real than in the image and text displays. Furthermore, follow-up experiments suggest the presence of the real item triggers preprogrammed consummatory Pavlovian processes that promote behaviors that lead to contact with appetitive items whenever they are available. (JEL C91, D03, D12, D87)Citation
Bushong, Benjamin, Lindsay M. King, Colin F. Camerer, and Antonio Rangel. 2010. "Pavlovian Processes in Consumer Choice: The Physical Presence of a Good Increases Willingness-to-Pay." American Economic Review, 100 (4): 1556–71. DOI: 10.1257/aer.100.4.1556Additional Materials
JEL Classification
- C91 Design of Experiments: Laboratory, Individual
- D91 Micro-Based Behavioral Economics: Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
- D12 Consumer Economics: Empirical Analysis
- D87 Neuroeconomics