Rebates, Matches, and Consumer Behavior

Douglas Davis and Edward Millner ()
Additional contact information
Edward Millner: Department of Economics, VCU School of Business

No 401, Working Papers from VCU School of Business, Department of Economics

Abstract: An experiment conducted to examine the effects of different discount formats on consumer purchases is reported. Participants made a series of purchase decisions for chocolate bars given (a) “rebates” from the listed price, (b) “matching” quantities of chocolates for each bar purchased, and (c) simple price reductions. Contrary to standard theoretical predictions, and consistent results in the context of charitable contributions by Eckel and Grossman (2003), we find that participants purchase significantly more chocolate bars under a “matching” sales format than under a comparable “rebate” format. Inattention to the net consequences of decisions, as well as some “rebate aversion”, explain the preference for matching discounts.

Keywords: Consumer Behavior; Experiment; Discount Formats (search for similar items in EconPapers)
JEL-codes: C91 D11 D46 (search for similar items in EconPapers)
Pages: 21 pages
Date: 2004-09
New Economics Papers: this item is included in nep-exp, nep-mic and nep-mkt
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Related works:
Journal Article: Rebates, Matches, and Consumer Behavior (2005)
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Persistent link: https://EconPapers.repec.org/RePEc:vcu:wpaper:0401

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