Advanced Search
MyIDEAS: Login

Voluntary payments, privacy and social pressure on the internet: A natural field experiment

Contents:

Author Info

  • Regner, Tobias
  • Riener, Gerhard

Abstract

The emergence of Pay-What-You-Want (PWYW) business models as a successful alternative to conventional uniform pricing brings up new questions related to the task of pricing. We investigate the effect of a reduction of privacy on consumers' purchase decisions (whether to buy, and if so how much to pay) in a natural experiment at an online music store with PWYW-like pricing. Our study extends the empirical evidence of the reduced anonymity effect, previously established for donation or public goods contexts, to a consumption environment. We find that revealing the name of the customer led to slightly higher payments, while it drastically reduced the number of customers purchasing. Overall, the regime led to a revenue loss of 15%. The experiment suggests that even low levels of social pressure without face to face interaction on customers leads to a reduction of welfare. --

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://econstor.eu/bitstream/10419/68231/1/734357842.pdf
Download Restriction: no

Bibliographic Info

Paper provided by Heinrich‐Heine‐Universität Düsseldorf, Düsseldorf Institute for Competition Economics (DICE) in its series DICE Discussion Papers with number 82.

as in new window
Length:
Date of creation: 2012
Date of revision:
Handle: RePEc:zbw:dicedp:82

Contact details of provider:
Postal: Universitätsstr.1, 40225 Düsseldorf
Phone: +49 211 81-15009
Fax: +49 211 81-15499
Email:
Web page: http://www.dice.hhu.de/en.html
More information through EDIRC

Related research

Keywords: Digital content; Voluntary Payments; PWYW; Public goods; Voluntary contributions; Social pressure; Internet; Privacy; Natural experiment;

Other versions of this item:

Find related papers by JEL classification:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Guido Imbens & Karthik Kalyanaraman, 2009. "Optimal Bandwidth Choice for the Regression Discontinuity Estimator," NBER Working Papers 14726, National Bureau of Economic Research, Inc.
  2. Tobias Regner, 2010. "Why Consumers Pay Voluntarily: Evidence from Online Music," Jena Economic Research Papers 2010-081, Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics.
  3. Hal R. Varian, 2005. "Copying and Copyright," Journal of Economic Perspectives, American Economic Association, vol. 19(2), pages 121-138, Spring.
  4. Cremer, Helmuth & Pestieau, Pierre, 2006. "Piracy Prevention and the Pricing of Information Goods," CEPR Discussion Papers 5556, C.E.P.R. Discussion Papers.
  5. Domon, Koji & Yamazaki, Naoto, 2004. "Unauthorized file-sharing and the pricing of digital content," Economics Letters, Elsevier, vol. 85(2), pages 179-184, November.
  6. Alastair R. Beresford & Dorothea Kübler & Sören Preibusch, 2011. "Unwillingness to Pay for Privacy: A Field Experiment," SFB 649 Discussion Papers SFB649DP2011-010, Sonderforschungsbereich 649, Humboldt University, Berlin, Germany.
  7. Charness, Gary & Gneezy, Uri, 2008. "What's in a name? Anonymity and social distance in dictator and ultimatum games," Journal of Economic Behavior & Organization, Elsevier, vol. 68(1), pages 29-35, October.
  8. George J. Stigler, 1980. "An Introduction to Privacy in Economics and Politics," University of Chicago - George G. Stigler Center for Study of Economy and State 10, Chicago - Center for Study of Economy and State.
  9. Andreoni, James & Petrie, Ragan, 2004. "Public goods experiments without confidentiality: a glimpse into fund-raising," Journal of Public Economics, Elsevier, vol. 88(7-8), pages 1605-1623, July.
  10. Tobias Regner & Javier A. Barria, 2007. "Do Consumers Pay Voluntarily? The Case of Online Music," Jena Economic Research Papers 2007-011, Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics.
  11. Stefano DellaVigna & John List & Ulrike Malmendier, 2012. "Testing for altruism and social pressure in charitable giving," Natural Field Experiments 00137, The Field Experiments Website.
  12. James Andreoni & Justin M. Rao & Hannah Trachtman, 2011. "Avoiding The Ask: A Field Experiment on Altruism, Empathy, and Charitable Giving," NBER Working Papers 17648, National Bureau of Economic Research, Inc.
  13. Alpizar, Francisco & Carlson, Fredrik & Johansson-Stenman, Olof, 2008. "Anonymity, Reciprocity, and Conformity: Evidence from Voluntary Contributions to a National Park in Costa Rica," Discussion Papers dp-08-03-efd, Resources For the Future.
  14. repec:feb:framed:0087 is not listed on IDEAS
  15. Riener, Gerhard & Traxler, Christian, 2012. "Norms, moods, and free lunch: Longitudinal evidence on payments from a Pay-What-You-Want restaurant," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 41(4), pages 476-483.
  16. Vincent Conitzer & Curtis R. Taylor & Liad Wagman, 2012. "Hide and Seek: Costly Consumer Privacy in a Market with Repeat Purchases," Marketing Science, INFORMS, vol. 31(2), pages 277-292, March.
  17. Soetevent, Adriaan R., 2003. "Anonymity in giving in a natural context : an economic field experiment in thirty churches," CCSO Working Papers 200308, University of Groningen, CCSO Centre for Economic Research.
  18. Hoffman, Elizabeth & McCabe, Kevin & Smith, Vernon L, 1996. "Social Distance and Other-Regarding Behavior in Dictator Games," American Economic Review, American Economic Association, vol. 86(3), pages 653-60, June.
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 in new window

Cited by:
  1. Egbert, Henrik & Greiff, Matthias & Xhangolli, Kreshnik, 2014. "PWYW Pricing ex post Consumption: A Sales Strategy for Experience Goods," MPRA Paper 53376, University Library of Munich, Germany.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:zbw:dicedp:82. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (ZBW - German National Library of Economics).

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 references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.

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