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The purpose of this study is to resolve inconsistencies in the literature about how one-time price promotions affect reference prices. Specifically, this study suggests that the measure of reference price used within a study (e.g. expected price or fair price) can affect the outcomes of that study.

This research uses three separate experiments, replicating and extending existing work, to simulate purchasing decisions for products in the context of a price promotion. Experiments allow careful control of the confounds presumed to cause the inconsistencies between studies.

Study 1 shows that measurement of different reference prices within the same experiment leads to carryover effects, which inflate the correlation between measures. Expected price and fair price appear to be conceptually and empirically distinct and should be measured separately to reduce design artifacts. Study 2 shows that one-time price promotions affect fair price, but not expected price, and Study 3 shows expected price and fair price converge after multiple promotions.

Independent measurement of reference price concepts allows robust claims about their distinctiveness. These findings have implications for how reference price should be measured in survey research and for pricing and promotional strategy.

This research contributes by showing how the measure of reference price used affects the outcomes of price promotion studies. It does this through the replication and extension of past research. Replication allows greater confidence in the findings of past research, and testing the same findings under different conditions allows for the boundaries of existing research to be delimited and generalizations to be made.

This paper presents a model relating Nagle and Holden's factors of price sensitivity to expected price and willingness to pay. This work presents various perspectives on price elasticity/sensitivity, empirically tests aspects of the influence of perception of the offer (product/service) on expected price, and illustrates how the pricing methods developed within provide quantitative precision to the practice of price setting by capturing perceptions important to consumers.

The authors used a within‐subjects design to study four brands in two product categories, automobiles and computers. Model evaluation employs ordinary least squares regression.

Ten qualitative factors were studied. Overall, the results show four factors predict expected price for the target market, product and brand. The factors are perceived substitutes, quality, fairness, and unique value.

This research makes the following contributions. First, the authors are able to quantify ten factors of price sensitivity relevant to the evaluation of product pricing. Second, they are able to identify the relevant factors of price sensitivity for two product categories specific to a given target market. Third, they provide a data‐driven model that enables translation of pricing variables into quantitative values to arrive at the price of a product. The major theoretical contribution of this paper is to show that Nagle and Holden's ten factors of price sensitivity may act in the following way: the change in product/service perception may influence expected price, and then the change in expected price influences willingness to pay. The empirical focus of the current research is on the first of these two changes.

The purpose of this paper is to investigate whether or not the offer price affects the transaction price and the number of days the property is on the market. Specifically, is it possible for the broker to use the offer price as an instrument for obtaining a higher transaction price?

To test the hypothesis the general hedonic model is used, where the deviation of the transaction price and expected price from the offer price is a function of time on the market.

The results indicate that a high offer price is more likely to result in a high ratio of transaction price to expected price compared to a low offer price.

However, the overall conclusion is affected by the state of the market, that is, whether the market is static, rising or falling.

The best selling strategy in a rising market seems to be set a high offer price compared to the expected sale price.

The main contribution is that the paper not only analyzes the relationship between offer and transaction price, but also its relationship to expected price. It also tests for the existence of spatial autocorrelation, which is unique in this type of study.

As sales of store brands increase, retailers are shifting their store branding strategies by raising store brand prices, extending their store brand assortments to high‐risk categories, and marketing store brands in high retail image formats. The purpose of the research is to explore the effects of these changes on consumers’ judgments of store brands. The conceptual framework is derived from pricing, prospect, and information processing theories. It is tested in two experiments. The study finds that consumers’ use of price information varies by decision‐making context. In particular, price‐based effects for store brands are moderated by the contextual factors of category risk and retail image.

This paper aims to investigate the influence of advertised reference price (ARP) and sales price (SP) as anchor points on the latitude of expected price, and subsequently on purchase intention (PI). The research involves the theoretical lens of selective anchoring mechanism, which allows investigation of the influence of ARP and SP in a situation where price estimation task is a “non-thoughtful processes”.

On the basis of quasi-experimental design, the study involves intercept survey of 142 shoppers.

The study finds that due to anchoring effect, the highest and the lowest expected prices shift toward ARP and SP, respectively. Consequently, it influences the latitude of expected price, which in turn influences purchase intention. In addition, the study proposes and tests a method to forecast expansion and contraction of the latitude of expected price.

It suggests a new mechanism to understand the simultaneous influence of ARP and SP, provides a mechanism to understand shifts in price latitude’s end-points and investigates a phenomenon with two externally provided anchors.

The study highlights the role of the latitude of expected price in understanding consumers’ response. Results suggest that a plausible ARP, when joined with an above-expectation SP, can fetch better consumer responses.

The study uniquely investigates a problem with two anchor points and two estimation targets, and proposes a construct of internal price uncertainty (IPU).

This study aims to examine what underlies the estimated relation between idiosyncratic volatility and realized return.

Idiosyncratic volatility has a dual effect on stock pricing: it not only affects investors' expected return but also affects the efficiency of stock price in reflecting its value. Therefore, the estimated relation between idiosyncratic volatility and realized return captures its relations with both expected return and the mispricing-related component due to its dual effect on stock pricing. The sign of its relation with the mispricing-related component is indeterminate.

The estimated relation between idiosyncratic volatility and realized return decreases and switches from positive to negative as the estimation sample consists of proportionately more ex ante overvalued observations; it increases and switches from negative to positive as the estimation sample consists of proportionately more ex post overvalued observations. In sum, the relation of idiosyncratic volatility with the mispricing-related component dominates its relation with expected return in its estimated relation with realized return. Moreover, its estimated relation with realized return varies with research design choices and even switches sign due to their effects on its relation with the mispricing-related component.

The novelty of the study is evident in the implication of its findings that one cannot infer the sign of the relation of idiosyncratic volatility with expected return from its estimated relation with realized return.

The purpose of this paper is to amend the New Keynesian Phillips Curve (NKPC) model to include inflation volatility. It provides results on the determinants of inflation volatility and expected inflation volatility for ordinary least squares and autoregressive distributed lags (1,1) models and for change in inflation volatility and change in expected inflation volatility using error correction mechanism (ECM) models. Output gap affects change in expected inflation volatility alone (in the ECM model) and not in the other models. Major determinants of inflation volatility and expected inflation volatility are identified. To the best of the authors knowledge this is the first paper to augment the NKPC to include inflation volatility.

Recent analysis has indicated the importance of inflation volatility for the monetary transmission mechanism in India (Kapur and Behera, 2012). In the analysis of such monetary policy mechanisms the NKPC has proved to be a useful tool. Thus Patra and Ray (2010) for India and Brissimis and Magginas (2008) for the USA find considerable support for the standard NKPC. The purpose of this paper is to synthesize and integrate these two models by extending the standard NKPC framework to include inflation volatility and test its significance for the case of India.

In the case of inflation volatility output gap, lagged output gap and lagged inflation volatility are all insignificant. The level of inflation has a negative significant impact whereas the level of expected inflation has a positive and significant impact. In the case of expected inflation volatility lagged output gap has a negative and significant impact, the price level has a positive and significant impact whereas expected price has a negative and weakly significant impact. ECM reveals change in inflation variability falls significantly with lagged inflation volatility and lagged inflation and less significantly with change in expected inflation. It rises with lagged expected inflation although the coefficient is only weakly significant. Lagged output gap and change in output gap are insignificant.

This paper makes two original contributions. First, it extends the New Keynesian framework to include inflation volatility. Second, it estimates this model for India. To the best of the authors knowledge this is the first paper to make these contributions.

Fewer researchers have investigated the climatic and economic drivers of land-use change simultaneously and the interplay between drivers. This paper aims to investigate the nonlinear and interaction effects of price and climate variables on the rice acreage in high-latitude regions of China.

This study applies a multivariate adaptive regression spline to characterize the effects of price and climate expectations on rice acreage in high-latitude regions of China from 1992 to 2017. Then, yield expectation is added into the model to investigate the mechanism of climate effects on rice area allocation.

The results of importance assessment suggest that rice price, climate and total agricultural area play an important role in rice area allocation, and the importance of temperature is always higher than that of precipitation, especially for minimum temperature. Based on the estimated hinge functions and coefficients, it is found that total agricultural area has strong nonlinear and interaction effects with climate and price as forms of third-order interaction. However, the order of interaction terms reduces to second order after absorbing the expected yield. Additionally, the marginal effects of driven factors are calculated at different quantiles. The total area shows a positive and increasing marginal effect with the increase of total area. But the positive impact of price on the rice area can only be observed when price reached 50% or higher quantiles. Climate variables also show strong nonlinear marginal effects, and most climatic effects would disappear or be weakened once absorbing the expected rice yield. Expected yield is an efficient mechanism to explain the correlation between crop area and climate variables, but the impact of minimum temperature cannot be completely modeled by the yield expectation.

To the best of the authors’ knowledge, this is the first study to examine the nonlinear response of land-use change to climate and economic in high-latitude regions of China using the machine learning method.

This paper aims at theoretical exploration of price and quantity setting behaviors of a monopolist encountering uncertain product demand within the mean‐risk frameworks. In the microeconomic literature, the relationships between price and quantity have been traditionally studied using the expected utility approach. This paper moves away from the traditional assumptions and compares various types of risk‐return approaches and explains why most of the monopoly firms follow pricing strategy instead of quantity setting strategy.

Price setting behavior and quantity setting behavior monopoly firms were examined with endogenous target value and comparative statics were used.

Comparison of various approaches reveals that risk‐averse customers might decrease purchases because of the price uncertainty or shift to other suppliers, which may explain why monopoly firms prefer their power over price setting rather than quantity setting.

The present study has introduced some testable propositions by comparing different behavioral models of price and quantity setting behaviors of a monopolist facing uncertain product demand.

This study contributes to understanding of firm's behavior in the face of uncertainty.

The conceptual nature of the paper makes the paper original in its contribution to the existing literature of the theory of firm.

The main purpose of this paper is to examine consumer perceptions of “scratch and save” (SAS) promotions, which are popular store‐level promotional tools. This paper particularly focuses on investigating the moderating effects of consumers' price consciousness and savings expectations.

Two laboratory experimental studies were employed to examine consumer responses to SAS promotions.

The results of two experiments show that SAS promotions positively affect consumer perceptions of offer value and store prices, and consumers' intentions to shop and spread positive word‐of‐mouth. In particular, the effects of SAS promotions are moderated by consumer price consciousness and expected savings. Furthermore, the first study shows that the level of claimed savings of SAS promotions does not favorably affect consumer reactions. The second study also shows that consumers' discounting of expected savings increases as the level of claimed savings of SAS promotions increases.

Although SAS promotions are widely used by various types of retailers, there really is little known as to how consumers respond to SAS promotions. By providing evidence of the effectiveness of SAS promotions, this paper enables pricing researchers to extend issues related to such promotional tools.

For retailers, the most distinctive finding of this paper is that the level of claimed savings may not significantly affect consumer perceptions and shopping intentions, although an SAS promotion would be an effective promotional tool.

As a preliminary effort to examine the effects of SAS promotions, this paper offers a discussion of the future research opportunities.