IDEAS home Printed from https://ideas.repec.org/a/kap/jbuset/v121y2014i2p217-231.html
   My bibliography  Save this article

Procedural and Distributive Fairness: Determinants of Overall Price Fairness

Author

Listed:
  • Jodie Ferguson
  • Pam Ellen
  • William Bearden

Abstract

The present research isolates the fairness assessment of the process used by the retailer to set a price, as well as the distributive fairness of the price compared to the price that others are offered, and examines the combined effect of procedural fairness and distributive fairness on overall price fairness. Two experimental studies examine procedural and distributive fairness effects on overall price fairness. In study 1, procedural fairness and distributive fairness are manipulated and found to interact to bring about overall price fairness. In study 2, suspicion toward the seller is found to mediate the relationship between procedural fairness and overall price fairness when the price is disadvantageous. Copyright Springer Science+Business Media Dordrecht 2014

Suggested Citation

  • Jodie Ferguson & Pam Ellen & William Bearden, 2014. "Procedural and Distributive Fairness: Determinants of Overall Price Fairness," Journal of Business Ethics, Springer, vol. 121(2), pages 217-231, May.
    • Handle: RePEc:kap:jbuset:v:121:y:2014:i:2:p:217-231
    DOI: 10.1007/s10551-013-1694-2
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1007/s10551-013-1694-2
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/s10551-013-1694-2?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Ernst Fehr & Simon Gächter, 2000. "Fairness and Retaliation: The Economics of Reciprocity," Journal of Economic Perspectives, American Economic Association, vol. 14(3), pages 159-181, Summer.
    2. Kahneman, Daniel & Knetsch, Jack L & Thaler, Richard H, 1986. "Fairness and the Assumptions of Economics," The Journal of Business, University of Chicago Press, vol. 59(4), pages 285-300, October.
    3. Kelly L. Haws & William O. Bearden, 2006. "Dynamic Pricing and Consumer Fairness Perceptions," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 33(3), pages 304-311, October.
    4. Maxwell, Sarah, 2002. "Rule-based price fairness and its effect on willingness to purchase," Journal of Economic Psychology, Elsevier, vol. 23(2), pages 191-212, April.
    5. Kahneman, Daniel & Knetsch, Jack L & Thaler, Richard, 1986. "Fairness as a Constraint on Profit Seeking: Entitlements in the Market," American Economic Review, American Economic Association, vol. 76(4), pages 728-741, September.
    6. Lisa E. Bolton & Joseph W. Alba, 2006. "Price Fairness: Good and Service Differences and the Role of Vendor Costs," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 33(2), pages 258-265, July.
    7. Bougie, J.R.G. & Pieters, R. & Zeelenberg, M., 2003. "Angry customers don't come back, they get back : The experience and behavioral implications of anger and dissatisfaction in services," Other publications TiSEM 1708fb71-fd68-41d9-b870-e, Tilburg University, School of Economics and Management.
    8. Tülin Erdem & Susumu Imai & Michael Keane, 2003. "Brand and Quantity Choice Dynamics Under Price Uncertainty," Quantitative Marketing and Economics (QME), Springer, vol. 1(1), pages 5-64, March.
    9. Xinshu Zhao & John G. Lynch & Qimei Chen, 2010. "Reconsidering Baron and Kenny: Myths and Truths about Mediation Analysis," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 37(2), pages 197-206, August.
    10. Vaidyanathan, Rajiv & Aggarwal, Praveen, 2003. "Who is the fairest of them all? An attributional approach to price fairness perceptions," Journal of Business Research, Elsevier, vol. 56(6), pages 453-463, June.
    11. Garbarino, Ellen & Maxwell, Sarah, 2010. "Consumer response to norm-breaking pricing events in e-commerce," Journal of Business Research, Elsevier, vol. 63(9-10), pages 1066-1072, September.
    12. Jodie Ferguson & Pam Ellen & Gabriela Piscopo, 2011. "Suspicion and Perceptions of Price Fairness in Times of Crisis," Journal of Business Ethics, Springer, vol. 98(2), pages 331-349, January.
    13. Offerman, Theo, 2002. "Hurting hurts more than helping helps," European Economic Review, Elsevier, vol. 46(8), pages 1423-1437, September.
    14. Dickson, Peter R. & Kalapurakal, Rosemary, 1994. "The use and perceived fairness of price-setting rules in the bulk electricity market," Journal of Economic Psychology, Elsevier, vol. 15(3), pages 427-448, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Fennell, Patrick B. & Coleman, Joshua T. & Kuo, Andrew, 2020. "The moderating role of donation quantifiers on price fairness judgments," Journal of Business Research, Elsevier, vol. 110(C), pages 464-473.
    2. Le Wang & Paul Benjamin Lowry & Xin (Robert) Luo & Han Li, 2023. "Moving Consumers from Free to Fee in Platform-Based Markets: An Empirical Study of Multiplayer Online Battle Arena Games," Information Systems Research, INFORMS, vol. 34(1), pages 275-296, March.
    3. Sayanti SHAW, 2018. "Role Of Need For Closure On Perceived Price Fairness," Proceedings of the INTERNATIONAL MANAGEMENT CONFERENCE, Faculty of Management, Academy of Economic Studies, Bucharest, Romania, vol. 12(1), pages 797-806, November.
    4. Paul Andon & Clinton Free & Radzi Jidin & Gary S. Monroe & Michael J. Turner, 2018. "The Impact of Financial Incentives and Perceptions of Seriousness on Whistleblowing Intention," Journal of Business Ethics, Springer, vol. 151(1), pages 165-178, August.
    5. Jonathan Farrar & Steven E. Kaplan & Linda Thorne, 2019. "The Effect of Interactional Fairness and Detection on Taxpayers’ Compliance Intentions," Journal of Business Ethics, Springer, vol. 154(1), pages 167-180, January.
    6. Jarrod Haar & Stuart C. Carr & James Arrowsmith & Jane Parker & Darrin Hodgetts & Siautu Alefaio-Tugia, 2018. "Escape from Working Poverty: Steps toward Sustainable Livelihood," Sustainability, MDPI, vol. 10(11), pages 1-14, November.
    7. Sourou Meatchi & Sandra Camus & Danielle Lecointre-Erickson, 2021. "Perceived unfairness of revenue management pricing: developing a measurement scale in the context of hospitality [Stratégie de tarification par le revenue management dans le secteur hôtelier : rédu," Post-Print hal-03373504, HAL.
    8. M. Paula Fitzgerald & Thomas K. Bias & Tami Gurley-Calvez, 2017. "The Affordable Care Act and Consumer Well-Being: Knowns and Unknowns," Journal of Consumer Affairs, Wiley Blackwell, vol. 51(1), pages 27-53, March.
    9. Talwar, Manish & Talwar, Shalini & Kaur, Puneet & Islam, A.K.M. Najmul & Dhir, Amandeep, 2021. "Positive and negative word of mouth (WOM) are not necessarily opposites: A reappraisal using the dual factor theory," Journal of Retailing and Consumer Services, Elsevier, vol. 63(C).
    10. Ferguson, Jodie L. & Brown, Brian P. & Johnston, Wesley J., 2017. "Partitioned pricing, price fairness perceptions, and the moderating effects of brand relationships in SME business markets," Journal of Business Research, Elsevier, vol. 72(C), pages 80-92.
    11. Li, Shaobo (Kevin) & Kokkoris, Michail D. & Savani, Krishna, 2020. "Does everyone have the potential to achieve their ideal body weight? Lay theories about body weight and support for price discrimination policies," Organizational Behavior and Human Decision Processes, Elsevier, vol. 157(C), pages 129-142.
    12. Alderighi, Marco & Nava, Consuelo R. & Calabrese, Matteo & Christille, Jean-Marc & Salvemini, Chiara B., 2022. "Consumer perception of price fairness and dynamic pricing: Evidence from Booking.com," Journal of Business Research, Elsevier, vol. 145(C), pages 769-783.
    13. Amanda Belarmino & Carola Raab & Tevfik Demirciftci, 2020. "The impact of resort fees on perceived fairness and destination brand image: an exploratory study," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 19(2), pages 129-137, April.
    14. Jocelyn D. Evans & Elise Perrault & Timothy A. Jones, 2017. "Managers’ Moral Obligation of Fairness to (All) Shareholders: Does Information Asymmetry Benefit Privileged Investors at Other Shareholders’ Expense?," Journal of Business Ethics, Springer, vol. 140(1), pages 81-96, January.
    15. Pade, Robin & Feurer, Sven, 2022. "The mitigating role of nostalgia for consumer price unfairness perceptions in response to disadvantageous personalized pricing," Journal of Business Research, Elsevier, vol. 145(C), pages 277-287.
    16. Shaikh, Ateeque, 2016. "Conceptualizing fairness in franchisor–franchisee relationship: Dimensions, definitions and preliminary construction of scale," Journal of Retailing and Consumer Services, Elsevier, vol. 28(C), pages 28-35.
    17. Mathur, Pragya & Sarin Jain, Shalini, 2020. "Not all that glitters is golden: The impact of procedural fairness perceptions on firm evaluations and customer satisfaction with favorable outcomes," Journal of Business Research, Elsevier, vol. 117(C), pages 357-367.
    18. El Ouardighi, Fouad & Feichtinger, Gustav & Grass, Dieter & Hartl, Richard & Kort, Peter M., 2016. "Autonomous and advertising-dependent ‘word of mouth’ under costly dynamic pricing," European Journal of Operational Research, Elsevier, vol. 251(3), pages 860-872.
    19. Diana Maria VRÂNCEANU & Claudia Elena ?UCLEA, 2016. "Customers' Price Fairness Perceptions On Hotel Services: Insights Into Romanian Market," Business Excellence and Management, Faculty of Management, Academy of Economic Studies, Bucharest, Romania, vol. 6(4), pages 70-79, September.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Kuo, Andrew & Rice, Dan Hamilton & Fennell, Patrick, 2016. "How fitting! The influence of fence-context fit on price discrimination fairness," Journal of Business Research, Elsevier, vol. 69(8), pages 2634-2640.
    2. Nathan Chubaka Mushagalusa & Eddy Balemba Kanyurhi & Deogratias Bugandwa Mungu Akonkwa & Patrick Murhula Cubaka, 2022. "Measuring price fairness and its impact on consumers’ trust and switching intentions in microfinance institutions," Journal of Financial Services Marketing, Palgrave Macmillan, vol. 27(2), pages 111-135, June.
    3. Richards, Timothy J. & Liaukonyte, Jura & Streletskaya, Nadia A., 2016. "Personalized pricing and price fairness," International Journal of Industrial Organization, Elsevier, vol. 44(C), pages 138-153.
    4. Kanupriya Katyal & Vinay Kanetkar & Sanjay Patro, 2019. "What is a fair fare? Exploring the differences between perceived price fairness and perceived price unfairness," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 18(2), pages 133-146, April.
    5. Campbell, Colin L. & Heinrich, Daniel & Schoenmüller, Verena, 2015. "Consumers' reaction to fair trade motivated price increases," Journal of Retailing and Consumer Services, Elsevier, vol. 24(C), pages 79-84.
    6. Hufnagel, Gerrit & Schwaiger, Manfred & Weritz, Louisa, 2022. "Seeking the perfect price: Consumer responses to personalized price discrimination in e-commerce," Journal of Business Research, Elsevier, vol. 143(C), pages 346-365.
    7. Richards, Timothy & Liaukonyte, Jura & Nadia, Streletskya, 2016. "Personalized Pricing and Price Fairness," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 235809, Agricultural and Applied Economics Association.
    8. Garbarino, Ellen & Maxwell, Sarah, 2010. "Consumer response to norm-breaking pricing events in e-commerce," Journal of Business Research, Elsevier, vol. 63(9-10), pages 1066-1072, September.
    9. Wamsler, Julia & Natter, Martin & Algesheimer, René, 2022. "Transitioning to dynamic prices: Should pricing authority remain with the company or be delegated to the service employees instead?," Journal of Business Research, Elsevier, vol. 139(C), pages 1476-1488.
    10. Hyun Joung Jin & Eun Young You, 2019. "Do Discounts in Ticket Prices Induce Sustainable Profit to Performing Arts Suppliers?," Sustainability, MDPI, vol. 11(14), pages 1-12, July.
    11. Frank Huber & Frederik Meyer & Kai Vollhardt & Tobias Heußler, 2011. "Die Bedeutung von Emotionen für die wahrgenommene Fairness bei Preiserhöhungen," Schmalenbach Journal of Business Research, Springer, vol. 63(4), pages 404-426, June.
    12. Lu, Zhi & Bolton, Lisa E. & Ng, Sharon & Chen, Haipeng (Allan), 2020. "The Price of Power: How Firm’s Market Power Affects Perceived Fairness of Price Increases," Journal of Retailing, Elsevier, vol. 96(2), pages 220-234.
    13. Bechwati, Nada Nasr & Sisodia, Rajendra S. & Sheth, Jagdish N., 2009. "Developing a model of antecedents to consumers' perceptions and evaluations of price unfairness," Journal of Business Research, Elsevier, vol. 62(8), pages 761-767, August.
    14. Adam Nguyen & Juan Meng, 2013. "Whether and to What Extent Consumers Demand Fair Pricing Behavior for Its Own Sake," Journal of Business Ethics, Springer, vol. 114(3), pages 529-547, May.
    15. Pick, Doreén & Zielke, Stephan, 2015. "How electricity providers communicate price increases – A qualitative analysis of notification letters," Energy Policy, Elsevier, vol. 86(C), pages 303-314.
    16. Anna Priester & Thomas Robbert & Stefan Roth, 2020. "A special price just for you: effects of personalized dynamic pricing on consumer fairness perceptions," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 19(2), pages 99-112, April.
    17. Homburg, Christian & Lauer, Karin & Vomberg, Arnd, 2019. "The multichannel pricing dilemma: Do consumers accept higher offline than online prices?," International Journal of Research in Marketing, Elsevier, vol. 36(4), pages 597-612.
    18. Alderighi, Marco & Nava, Consuelo R. & Calabrese, Matteo & Christille, Jean-Marc & Salvemini, Chiara B., 2022. "Consumer perception of price fairness and dynamic pricing: Evidence from Booking.com," Journal of Business Research, Elsevier, vol. 145(C), pages 769-783.
    19. Mark Ratchford, 2014. "Perceptions of price (un)fairness in a channel context," Marketing Letters, Springer, vol. 25(4), pages 343-353, December.
    20. Sayanti SHAW, 2018. "Role Of Need For Closure On Perceived Price Fairness," Proceedings of the INTERNATIONAL MANAGEMENT CONFERENCE, Faculty of Management, Academy of Economic Studies, Bucharest, Romania, vol. 12(1), pages 797-806, November.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:jbuset:v:121:y:2014:i:2:p:217-231. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.