Mitigating Price Anchoring Effects through Cheap Talk in Discrete Choice Experiments
2019/05/21
研討會日期 : 2019-05-21
時間 : 14:30
主講人 : Professor Ju-Chin Huang (黃如錦)
主持人 : Professor Daigee Shaw
地點 : Conference Room B110
演講者簡介 : Professor Huang received her Ph.D. in Economics & Statistics from North Carolina State University in 1994. She is currently a Professor in the Department of Economics at Paul College of Business and Economics, University of New Hampshire. Her research interests are Environmental Valuation and Applied Econometrics.
演講摘要 : This study addresses the issue of price anchoring in discrete choice experiments. The cheap talk approach of Cummings and Taylor (1999) is adapted as an ex-ante mechanism to address the issue of price anchoring effects. This approach is applied to a choice experiment used to examine consumers’ willingness-to-pay for local and/or organic tomatoes in Northern New England and develops three primary contributions. First, evidence from this study shows that anchoring effects are present and second, cheap talk plays a mitigating role on these effects. In particular, price anchoring changes WTP estimates between 26%-51% and exposure to anchoring-specific cheap talk is associated with a reduction in these anchoring effects between 60% and 80%. These results are explained through decreases in price sensitivity induced by increasing the mean price vector and subsequent increases in price sensitivity due to the cheap-talk intervention. Finally, this study reveals that consumers are willing-to-pay a substantial price premium for locally grown tomatoes, from $0.96-$1.12 per pound, offering some guidance for policy regarding growing practice and farm land use as regional coalitions support local agriculture expansion in the Northeast.
