Consumer Reactions to Drip Pricing

References

• Abraham AT, Hamilton RW (2018) When does partitioned pricing lead to more favorable consumer preferences? Meta-analytic evidence. J. Marketing Res. 55(5):686–703.Crossref, Google Scholar
• Aronson E (1976) The Social Animal (W.H. Freeman, San Francisco).Google Scholar
• Australian Competition and Consumer Commission (2010) The Competition and Consumer Act (Legislation, Australian Competition and Consumer Commission, Australia).Google Scholar
• Bender A (2014) Why airlines will regret the Transparent Airfares Act. Forbes (August 29), https://www.forbes.com/sites/andrewbender/2014/08/29/why-airlines-will-regret-the-transparent-airfares-act/#59586ac65632.Google Scholar
• Blake T, Moshary S, Sweeney K, Tadelis S (2018) Price salience and product choice. NBER Working Paper 25186, National Bureau of Economic Research, Cambridge, MA.Google Scholar
• Brown J, Hossain T, Morgan J (2010) Shrouded attributes and information suppression: Evidence from the field. Quart. J. Econom. 125(2):859–876.Crossref, Google Scholar
• Canadian Competition Bureau (2014) Remarks by Matthew Boswell. Transcription of remarks, November 28, Commissioner of Competition, Ottawa, ON, Canada.Google Scholar
• Carrns A (2019) Marriott and Hilton sued over “resort fees,” long a bane for travelers. New York Times (August 23), https://www.nytimes.com/2019/08/23/business/marriott-hilton-lawsuit-resort-fees.html.Google Scholar
• Chakravarti D, Krish PR, Srivastava J (2002) Partitioned presentation of multicomponent bundle prices: Evaluation, choice and underlying processing effects. J. Consumer Psych. 12(3):215–229.Crossref, Google Scholar
• Cheema A (2008) Surcharges and seller reputation. J. Consumer Res. 35(1):167–177.Crossref, Google Scholar
• Chetty R, Looney A, Kroft K (2009) Salience and taxation: Theory and evidence. Amer. Econom. Rev. 99(4):1145–1177.Crossref, Google Scholar
• Chiles B (2017) Shrouded prices and firm reputation: Evidence from the U.S. hotel industry. Preprint, submitted April 17, https://ssrn.com/abstract=295295.Google Scholar
• Department of Transportation (2011a) Enhancing airline passenger protections. Federal Register: Rules and Regulations 76(79):23110–23167.Google Scholar
• Department of Transportation (2011b) U.S. Department of Transportation expands airline passenger protections. Press release, Department of Transportation, Washington, DC.Google Scholar
• Department of Transportation (2017) U.S. Department of Transportation proposes disclosure of customer-specific airline baggage fee information along with the airfare. Press release, Department of Transportation, Washington, DC.Google Scholar
• Elliott C (2014a) The Transparent Airfares Act, hiding the true cost of your flight. Washington Post (April 24), https://www.washingtonpost.com/lifestyle/travel/the-transparent-airfares-act-hiding-the-true-cost-of-your-flight/2014/04/24/3d1caab0-c9a6-11e3-a75e-463587891b57_story.html.Google Scholar
• Elliott C (2014b) Airfare “transparency” gets cloudier. USA Today (May 12), https://www.usatoday.com/story/travel/flights/2014/05/12/airfare-transparency-gets-cloudier/8991023.Google Scholar
• Elliott C (2018) New legislation could make it harder to tell how much your airline tickets cost. Washington Post (April 19), https://www.washingtonpost.com/lifestyle/travel/new-legislation-could-make-it-harder-to-tell-how-much-your-airline-tickets-cost/2018/04/18/43af1f0a-41ae-11e8-bba2-0976a82b05a2_story.html.Google Scholar
• Ellison G (2005) A model of add-on pricing. Quart. J. Econom. 120(2):585–637.Google Scholar
• Ellison G, Ellison SF (2009) Search, obfuscation, and price elasticities on the Internet. Econometrica 77(2):427–452.Crossref, Google Scholar
• Evans P (2016) Budget and Avis pay $3M fine to settle claim that ad prices hide fees. CBC News (June 2), http://www.cbc.ca/news/business/avis-budget-car-rental-1.3612671.Google Scholar
• Farrell J (2012) Consumer and competitive effects of obscure pricing. Presentation, Conference on the Economics of Drip Pricing, May 21, Federal Trade Commission, Washington, DC.Google Scholar
• Federal Trade Commission (2012a) The economics of drip pricing. Presentation (May 21), https://www.ftc.gov/news-events/events-calendar/2012/05/economics-drip-pricing.Google Scholar
• Federal Trade Commission (2012b) FTC warns hotel operators that price quotes that exclude “resort fees” and other mandatory surcharges may be deceptive. Press release (November 28), https://www.ftc.gov/news-events/press-releases/2012/11/ftc-warns-hotel-operators-price-quotes-exclude-resort-fees-other.Google Scholar
• Federal Trade Commission (2019) Opening remarks of Commissioner Rebecca Kelly Slaughter, as prepared for delivery. “That’s the Ticket”: An FTC workshop about online ticket sales (June 11), https://www.ftc.gov/system/files/documents/public_statements/1527238/slaughter_-_prepared_remarks_ftc_tickets_workshop_6-11-19.pdf.Google Scholar
• Festinger L (1957) A Theory of Cognitive Dissonance (Stanford University Press, Stanford, CA).Crossref, Google Scholar
• Fletcher A (2012) Drip pricing: UK experience. Presentation, Conference on the Economics of Drip Pricing, May 21, Federal Trade Commission, Washington, DC.Google Scholar
• Gabaix X, Laibson D (2006) Shrouded attributes, consumer myopia and information suppression in competitive markets. Quart. J. Econom. 121(2):505–540.Crossref, Google Scholar
• Greenleaf EA, Johnson EJ, Morwitz VG, Shalev E (2016) The price does not include additional taxes, fees, and surcharges: A review of research on partitioned pricing. J. Consumer Psych. 26(1):105–124.Crossref, Google Scholar
• Grossman SJ (1981) The informational role of warranties and private disclosure about product quality. J. Law Econom. 24(3):461–483.Crossref, Google Scholar
• Hayes AF (2013) Introduction to Mediation, Moderation, and Conditional Process Analysis: A Regression-Based Approach (Guilford Press, New York).Google Scholar
• Hayes AF, Preacher KJ (2014) Statistical mediation analysis with a multicategorical independent variable. British J. Math. Statist. Psych. 67(3):451–470.Crossref, Google Scholar
• Hossain T, Morgan J (2006) … Plus shipping and handling: Revenue (non) equivalence in field experiments on eBay. Adv. Econom. Anal. Policy 6(2):1–27.Google Scholar
• Huck S, Wallace B (2010) The impact of price frames on consumer decision making. Report, Office of Fair Trading, London.Google Scholar
• Iacobucci D (2012) Mediation analysis and categorical variables: The final frontier. J. Consumer Psych. 22(4):582–594.Crossref, Google Scholar
• Josephs L (2017) Airlines to rake in record $57 billion in passenger fees this year, study shows. CNBC (November 27), https://www.cnbc.com/2017/11/27/airlines-to-rake-in-record-57-billion-in-passenger-fees-this-year.html.Google Scholar
• Kahneman D, Knetsch JL, Thaler RH (1991) Anomalies: The endowment effect, loss aversion, and status quo bias. J. Econom. Perspect. 5(1):193–206.Crossref, Google Scholar
• Lambrecht A, Skiera B (2006) Paying too much and being happy about it: Existence, causes, and consequences of tariff-choice biases. J. Marketing Res. 43(2):212–223.Crossref, Google Scholar
• Lee YH, Han CY (2002) Partitioned pricing in advertising: Effects on brand and retailer attitudes. Marketing Lett. 13(1):27–40.Crossref, Google Scholar
• Levin A (2017) Rules requiring airlines to disclose fees killed by Trump’s DOT. Bloomberg News (December 7), https://www.bloomberg.com/news/articles/2017-12-07/rules-requiring-airlines-to-disclose-fees-killed-by-trump-s-dot.Google Scholar
• Milgrom PR (1981) Good news and bad news: Representation theorems and applications. Bell J. Econom. 12(2):380–391.Crossref, Google Scholar
• Morwitz VG, Greenleaf E, Johnson E (1998) Divide and prosper: Consumers’ reactions to partitioned prices. J. Marketing Res. 35(4):453–463.Crossref, Google Scholar
• NCL Communications (2019) NCL: BOSS ACT is the fix a broken ticket market needs. NCL Communications (June 13), https://www.nclnet.org/boss_act_2019.Google Scholar
• Palmer D (2017) Virgin, Jetstar fined over “drip-pricing” on airfares. The Weekend Australian (March 7), http://www.theaustralian.com.au/business/aviation/virgin-jetstar-fined-over-drippricing-on-airfares/news-story/4b2ec8261a41cb423f4f5bb57dc9aedb.Google Scholar
• Repetti T, Roe S, Gregory A (2015) Pricing strategies for resort fees: Consumer preferences favor simplicity. Internat. J. Contemporary Hospitality Management 27(5):790–809.Crossref, Google Scholar
• Robbert T (2015) Feeling nickeled and dimed—consequences of drip pricing. J. Service Theory Practice 25(5):621–635.Crossref, Google Scholar
• Robbert T, Roth S (2014) The flip side of drip pricing. J. Product Brand Management 23(6):413–419.Crossref, Google Scholar
• Rosenbloom S (2017) Hotels rake in record fees, and travelers foot the bill. New York Times (September 29), https://www.nytimes.com/2017/09/29/travel/hotels-rake-in-record-fees-and-travelers-foot-the-bill.html.Google Scholar
• Sampson H (2019) Resort fees are facing a fresh crackdown from members of Congress. Washington Post (October 4), https://www.washingtonpost.com/travel/2019/10/04/resort-fees-are-facing-fresh-crackdown-members-congress/.Google Scholar
• Seim K, Vitorino MA, Muir DM (2017a) Do consumers value price transparency? Quant. Marketing Econom. 15(4):305–339.Crossref, Google Scholar
• Seim K, Vitorino MA, Muir DM (2017b) Drip pricing when consumers have limited foresight: Evidence from driving school fees. Preprint, submitted February 19, 2013, https://ssrn.com/abstract=2220986.Google Scholar
• Shelanski HA, Farrell J, Hanner D, Metcalf CJ, Sullivan MW, Wendling BW (2012) Economics at the FTC: Drug and PBM mergers and drip pricing. Rev. Indust. Organ. 41(4):303–319.Crossref, Google Scholar
• Silk R (2017) DOT's proposed baggage-fee rule might not survive Trump. Travel Weekly (January 24), http://www.travelweekly.com/Travel-News/Government/DOT-proposed-baggage-fee-rule-might-not-survive-Trump.Google Scholar
• Srull TK, Wyer RS (1979) The role of category accessibility in the interpretation of information about persons: Some determinants and implications. J. Personality Soc. Psych. 37(10):1660–1672.Crossref, Google Scholar
• Staw BM (1976) Knee-deep in the big muddy: A study of escalating commitment to a chosen course of action. Organ. Behav. Human Performance 16(1):27–44.Crossref, Google Scholar
• Staw BM, Fox F (1977) Escalation: Some determinants of commitment to a previously chosen course of action. Human Relations 30(5):431–450.Crossref, Google Scholar
• Staw BM, Ross J (1978) Commitment to a policy decision: A multitheoretical perspective. Admin. Sci. Quart. 23(1):40–64.Crossref, Google Scholar
• Sullivan MW (2017) Economic analysis of hotel resort fees. Report, Bureau of Economics, Federal Trade Commission, Economic Issues (January), https://www.ftc.gov/system/files/documents/reports/economic-analysis-hotel-resort-fees/p115503_hotel_resort_fees_economic_issues_paper.pdf.Google Scholar
• The Canadian Press (2017) Hertz and Thrifty to pay $1.25m fine following advertising probe. thestar.com (April 24), https://www.thestar.com/business/2017/04/24/hertz-and-thrifty-to-pay-125m-fine-following-advertising-probe.html.Google Scholar
• Waldman M (2012) What do we know about drip pricing? Lessons from the aftermarkets literature. Presentation, Conference on the Economics of Drip Pricing, May 21, Federal Trade Commission, Washington, DC.Google Scholar
• White SM, Sussman AB, Beckett D (2019) When shrouded prices seem transparent: A preference for costly complexity. Working paper, University of Chicago, Chicago.Google Scholar
• Xia L, Monroe KB (2004) Price partitioning on the Internet. J. Interactive Marketing 18(4):63–73.Crossref, Google Scholar
• Zenger H (2013) Why firms’ exploitation of consumer myopia may benefit myopic consumers. Econom. Lett. 118(2):307–309.Crossref, Google Scholar