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Do anchors hold for real? Anchoring effect and hypothetical bias in declared WTP

Author

Listed:
  • Magdalena Brzozowicz

    (Faculty of Economic Sciences, University of Warsaw)

  • Michał Krawczyk

    (Faculty of Economic Sciences, University of Warsaw)

  • Przemysław Kusztelak

    (Faculty of Economic Sciences, University of Warsaw)

Abstract

In two field experiments the authors elicit willingness to pay for a mascara, systematically manipulating incentives to provide the true valuation (hypothetical vs. real) and anchors (high vs. low or high vs. none). Contrary to the key hypothesis, they find no interaction between the two effects: the anchoring effect is not attenuated when decisions actually matter. This finding speaks to validity of hypothetical market research methods and against the use of anchors to reduce hypothetical bias. It also contributes to the discussion of the mechanism underlying anchoring effect, suggesting it is not caused by insufficient conscious effort to drift away from the anchor.

Suggested Citation

  • Magdalena Brzozowicz & Michał Krawczyk & Przemysław Kusztelak, 2017. "Do anchors hold for real? Anchoring effect and hypothetical bias in declared WTP," Working Papers 2017-24, Faculty of Economic Sciences, University of Warsaw.
    • Handle: RePEc:war:wpaper:2017-24
    as

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    File URL: http://www.wne.uw.edu.pl/index.php/download_file/3957/
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    References listed on IDEAS

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    6. Daniel McFadden & Kenneth Train (ed.), 2017. "Contingent Valuation of Environmental Goods," Books, Edward Elgar Publishing, number 17527.
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    Cited by:

    1. Li, Lunzheng & Maniadis, Zacharias & Sedikides, Constantine, 2021. "Anchoring in Economics: A Meta-Analysis of Studies on Willingness-To-Pay and Willingness-To-Accept," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 90(C).

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    More about this item

    Keywords

    anchoring effect; hypothetical bias; WTP; experiment;
    All these keywords.

    JEL classification:

    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • M31 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - Marketing

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