Cosumer Disenchantment, Loss Aversion and Price Rigidity
AbstractA retail market in which customers repeat purchase is considered. Customers are influenced not only by the price set by the firm, but by their level of disenchantment. Disenchantment measures the degree of customer disaffection in the customer-firm relationship. Changes in price lead to proportional changes in disenchantment. It is demonstrated that when customers possess loss aversion with respect to disenchantment levels, the firm's optimal response is characterised by price rigidity.
Download InfoTo our knowledge, this item is not available for download. To find whether it is available, there are three options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.
Bibliographic InfoPaper provided by Tasmania - Department of Economics in its series Papers with number 1996-12.
Length: 21 pages
Date of creation: 1996
Date of revision:
Contact details of provider:
Postal: UNIVERSITY OF TASMANIA, DEPARTMENT OF ECONOMICS, HOBART TASMANIA 7001 AUSTRALIA.
Phone: +61 3 6226 7672
Fax: +61 3 6226 7587
Web page: http://www.utas.edu.au/economics-finance/
More information through EDIRC
PRICING; CONSUMPTION; ENTERPRISES;
Find related papers by JEL classification:
- D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
- D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
- L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Steffen Ahrens & Inske Pirschel & Dennis Snower, 2014.
"A Theory of Price Adjustment under Loss Aversion,"
Kiel Working Papers
1915, Kiel Institute for the World Economy.
- Ahrens, Steffen & Pirschel, Inske & Snower, Dennis J., 2014. "A theory of price adjustment under loss aversion," Economics Working Papers 2014-05, Christian-Albrechts-University of Kiel, Department of Economics.
- Ahrens, Steffen & Pirschel, Inske & Snower, Dennis J., 2014. "A Theory of Price Adjustment under Loss Aversion," IZA Discussion Papers 8138, Institute for the Study of Labor (IZA).
- Steffen Ahrens & Inske Pirschel & Dennis Snower, 2014. "A Theory of Price Adjustment under Loss Aversion," CESifo Working Paper Series 4789, CESifo Group Munich.
- Ahrens, Steffen & Pirschel, Inske & Snower, Dennis J., 2014. "A Theory of Price Adjustment under Loss Aversion," CEPR Discussion Papers 9964, C.E.P.R. Discussion Papers.
- Pirschel, Inske & Ahrens, Steffen & Snower, Dennis, 2013. "A Theory of Price Adjustment under Loss Aversion," Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 79793, Verein für Socialpolitik / German Economic Association.
- Sibly, Hugh, 2002. "Loss averse customers and price inflexibility," Journal of Economic Psychology, Elsevier, vol. 23(4), pages 521-538, August.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Thomas Krichel).
If references are entirely missing, you can add them using this form.