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Fairness of Pricing Decisions

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  • Graddy, Kathryn
  • Robertson, Diana C.

Abstract

Our research investigated pricing policies of fast-food restaurants in predominantly black neighborhoods. We argue that the lack of monitoring of franchisees’ pricing policies leads to higher prices. Results indicate that franchisees are significantly more likely than company-owned outlets to charge higher prices based on the proportion of blacks in a neighborhood. These price differences do not appear to be explained away by cost or competition factors. Our findings do not establish an intent to discriminate; nevertheless, we discuss the fairness of the pricing structure found.

Suggested Citation

  • Graddy, Kathryn & Robertson, Diana C., 1999. "Fairness of Pricing Decisions," Business Ethics Quarterly, Cambridge University Press, vol. 9(2), pages 225-243, April.
    • Handle: RePEc:cup:buetqu:v:9:y:1999:i:02:p:225-243_00
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    Cited by:

    1. Leschewski, Andrea Marie & Weatherspoon, Dave D., 2014. "Fast Food Restaurant Pricing Strategies in Michigan Food Deserts," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 17(A), pages 1-24, March.

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