TITLE:
Perceived Price Fairness in Pay-What-You-Want: A Multi-Country Study
AUTHORS:
Julius Bettray, Augustin Suessmair, Tim Dorn
KEYWORDS:
Perceived Price Fairness, Pay What You Want, PWYW, Willingness to Pay, Participative Pricing, Price Determination, Price Evaluation, Perception
JOURNAL NAME:
American Journal of Industrial and Business Management,
Vol.7 No.5,
May
27,
2017
ABSTRACT: The present study investigated perceived price
fairness (PPF) and aimed to reveal determinants of PPF within the participative
pricing mechanism paywhat-you-want (PWYW). Results support the hypothesis that
PPF in PWYW conditions is higher than PPF in ordinary price setting (OPS)
conditions. Determinants of PPF in PWYW conditions were identified to include
both the price level and the degree of social interaction. Whereas the results
conform to previous research that PPF correlates negatively with the price level
in OPS conditions, this study reveals a positive correlation between the price
level and PPF in PWYW conditions, which suggests that the buyer’s mental model
of PPF varies with the process of price determination. Therefore, future
research should re-examine consequences of PPF in PWYW conditions.
Additionally, results show cross-country differences of PPF and the influence
of the price level on PPF.