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The influence of suggestions of reference groups in the compromise effect

Author

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  • Chuang, Shih-Chieh
  • Cheng, Yin-Hui
  • Hsu, Chun-Ting

Abstract

Context effect researchers who have examined the mechanism underlying the compromise effect suggest that justification is a critical factor leading people to select the compromise option, thus implying the importance of interpersonal influence on consumer choice. However, little research has empirically investigated the link between the compromise effect and interpersonal influence. This study addresses that gap in the literature by analyzing whether reference group suggestions determine the strength of the compromise effect. Three experiments test the associated hypotheses. The results show that suggestions made by reference group members have a significant influence on the magnitude of the compromise effect.

Suggested Citation

  • Chuang, Shih-Chieh & Cheng, Yin-Hui & Hsu, Chun-Ting, 2012. "The influence of suggestions of reference groups in the compromise effect," Journal of Economic Psychology, Elsevier, vol. 33(3), pages 554-565.
    • Handle: RePEc:eee:joepsy:v:33:y:2012:i:3:p:554-565
    DOI: 10.1016/j.joep.2011.11.001
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    References listed on IDEAS

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    1. Simonson, Itamar, 1989. "Choice Based on Reasons: The Case of Attraction and Compromise Effects," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 16(2), pages 158-174, September.
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    3. Shih-Chieh Chuang & HsiuJu Yen, 2007. "The impact of a product’s country-of-origin on compromise and attraction effects," Marketing Letters, Springer, vol. 18(4), pages 279-291, December.
    4. Aimee Drolet & Mary Frances Luce & Itamar Simonson, 2009. "When Does Choice Reveal Preference? Moderators of Heuristic versus Goal-Based Choice," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 36(1), pages 137-147, June.
    5. Xinshu Zhao & John G. Lynch & Qimei Chen, 2010. "Reconsidering Baron and Kenny: Myths and Truths about Mediation Analysis," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 37(2), pages 197-206, August.
    6. Simonson, Itamar & Nowlis, Stephen M, 2000. "The Role of Explanations and Need for Uniqueness in Consumer Decision Making: Unconventional Choices Based on Reasons," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 27(1), pages 49-68, June.
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    Citations

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    Cited by:

    1. Pinger, Pia & Ruhmer-Krell, Isabel & Schumacher, Heiner, 2016. "The compromise effect in action: Lessons from a restaurant's menu," Journal of Economic Behavior & Organization, Elsevier, vol. 128(C), pages 14-34.
    2. Cheng, Yin-Hui & Chuang, Shih-Chieh & Pei-I Yu, Annie & Lai, Wan-Ting, 2019. "Change in your wallet, change your choice: The effect of the change-matching heuristic on choice," Journal of Retailing and Consumer Services, Elsevier, vol. 49(C), pages 67-76.
    3. Bieberstein, Frauke von & Jaussi, Stefanie & Vogel, Claudia, 2020. "Challenge-seeking and the gender wage gap: A lab-in-the-field experiment with cleaning personnel," Journal of Economic Behavior & Organization, Elsevier, vol. 175(C), pages 251-277.
    4. Jiarong Shi & Zihao Jiang, 2023. "Willingness to pay a premium price for green products: does a reference group matter?," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 25(8), pages 8699-8727, August.

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    More about this item

    Keywords

    Reference group; Compromise effect; Context effect;
    All these keywords.

    JEL classification:

    • M31 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - Marketing

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