Price as an Indicator of Quality: Implications for Utility and Demand Functions

Journal of Retailing

Volumn 86, Issue 1, 2010, Pages 69-84

  Ding, Min ^a   Ross Jr , William T ^a   Rao, Vithala R ^b  

^a PENNSYLVANIA STATE UNIVERSITY   (United States)

^b Dyson School of Applied Economics and Management   (United States)

Author keywords

Analysis; Incentive alignment; Price and quality; Utility functions

Indexed keywords

EID: 77949492085     PISSN: 00224359     EISSN: None     Source Type: Journal    
DOI: 10.1016/j.jretai.2010.01.002     Document Type: Article

References (30)

1. Bagwell K., and Riordan M.H. High and Declining Prices Signal Product Quality. American Economic Review 81 1 (1991) 224-239
2. Ding M. An Incentive-Aligned Mechanism for Conjoint Analysis. Journal of Marketing Research 44 2 (2007) 214-223
3. Ding M., Grewel R., and Liechty J. Designing Optimal Products-An Incentive-Compatible Approach. Journal of Marketing Research 42 1 (2005) 67-82
4. Ding M., Park Y.H., and Bradlow E. Barter Markets for Conjoint Analysis. Management Science 55 6 (2009) 1003-1017
5. Gabor A., and Granger C.W.J. Price as an Indicator of Quality: Report on an Enquiry. Economica 33 129 (1966) 43-70
6. Hardie B.G.S., Johnson E.J., and Fader P.S. Loss Aversion and Reference Dependence Effects on Brand Choice. Marketing Science 12 Fall (1993) 257-377
7. Kahneman D., and Tversky A. Prospect Theory: An Analysis of Decision Under Risk. Econometrica 47 March (1979) 263-291
8. Lambert Z.V. Product Perception: An Important Variable in Price Strategy. Journal of Marketing 34 (1970) 68-76
9. Leavett H.J. A Note on Some Experimental Findings about the Meaning of Price. Journal of Business 27 July (1954) 205-210
10. Lichtenstein D.R., Bloch P.H., and Black W.C. Correlates of Price Acceptability. Journal of Consumer Research 15 2 (1988) 243-252
11. Lichtenstein D.R., and Burton S. The Relationship Between Perceived and Objective Price-Quality. Journal of Marketing Research 26 (1989) 429-443
12. Mas-Colell A., Whinston M.D., and Green J. Microeconomics (1995), Oxford University Press, New York
13. Monroe K.B., and Krishnan R. The Effect of Price on Subjective Product Expectations. In: Jacoby J., and Olson J.C. (Eds). Perceived Quality: How Consumers View Stores and Merchandise (1985), Lexington, Lexington, MA 209-232
14. Ofir C. Reexamining Latitude of Price Acceptability and Price Thresholds: Predicing Basic Consumer Reaction to Price. Journal of Consumer Research 30 4 (2004) 612-621
15. Peterson R.A., and Wilson W.R. Perceived Risk and Price Reliance Schema as Price-Perceived Quality Mediators. In: Jacoby J., and Olson J.C. (Eds). Perceived Quality: How Consumers View Stores and Merchandise (1985), D.C. Heath and Company, Lexington, MA 247-268
16. Putler D.S. Incorporating Reference Price Effects into a Theory of Consumer Choice. Marketing Science 11 3 (1992) 287-310
17. Puto C.P. The Framing of Buying Decisions. Journal of Consumer Research 14 December (1987) 301-315
18. Rao A.R., and Monroe K.B. The Moderating Effect of Prior Knowledge on Cue Utilization in Product Evaluations. Journal of Consumer Research 15 2 (1988) 253-264
19. Rao A.R., and Sieben W.A. The Effect of Prior Knowledge on Price Acceptability and the Type of Information Examined. Journal of Consumer Research 19 2 (1992) 256-270
20. Rao V.R. Pricing Research in Marketing: The State of the Art. Journal of Business 57 (1984) S39-S60
21. Rao V.R. Pricing Models in Marketing. In: Eliashberg J., and Lilien G.L. (Eds). Handbook of MS/OR: Marketing (1993), North-Holland Press
22. Rao V.R., and Sattler H. Measurement of Price Effects with Conjoint Analysis: Separating Informational and Allocative Effects of Price. In: Gustafsson A., Hermann A., and Frank Huber (Eds). Conjoint Measurement: Methods and Applications (2000), Springer-Verlag 47-66
23. Schindler R.M. Symbolic Meanings of a Price Ending. In: Holman R.H., and Solomon M.R. (Eds). Advances in Consumer Research Vol. 18 (1991), Association for Consumer Research, Provo, UT 794-801
24. Shoemaker R., Debanjan M., Yuxin C., and Essegaier S. A Comment on 'Price-Endings When Prices Signal Quality'. Management Science 49 12 (2003) 1753-1758
25. Stiving M. Price-Endings When Prices Signal Quality. Management Science 46 12 (2000) 1617-1629
26. Suri R., and Monroe K.B. The Effect of Time Constraints on Consumers' Judgments of Prices and Products. Journal of Consumer Research 30 1 (2003) 92-104
27. Swalm R.O. Utility Theory-Insights into Risk Taking. Harvard Business Review 44 November-December (1966) 123-138
28. Tirole J. The Theory of Industrial Organization (1988), The MIT Press, Cambridge, MA
29. Winer R.S. A Reference Price Model of Brand Choice for Frequently Purchased Products. Journal of Consumer Research 13 September (1986) 250-256
30. Zeithaml V.A. Consumer Perceptions of Price, Quality, and Value: A Means-End Model and Synthesis of Evidence. Journal of Marketing 52 3 (1988) 2-22