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The Scarcity Bias

Author

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  • Luigi Mittone
  • Lucia Savadori

Abstract

The bias generated by the subjective perception of scarcity on the consumer's choice is investigated using two separated experiments. The first experiment is aimed to define the prevailing preferences towards a set of commodities, the second experiment checked the effects produced by the perception that a given good is "scarce". The results shown a preference reversal phenomenon when scarcity is introduced in the experimental design. The results are coherent with a previous experiment (Mittone, Savadori, Rumiati, 2005) based on a developmental explanation of the basic scarcity bias and carried on a sample of children as participants.

Suggested Citation

  • Luigi Mittone & Lucia Savadori, 2005. "The Scarcity Bias," CEEL Working Papers 0505, Cognitive and Experimental Economics Laboratory, Department of Economics, University of Trento, Italia.
    • Handle: RePEc:trn:utwpce:0505
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    References listed on IDEAS

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    1. Kelvin J. Lancaster, 1966. "A New Approach to Consumer Theory," Journal of Political Economy, University of Chicago Press, vol. 74(2), pages 132-132.
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    Cited by:

    1. Ivan Soraperra, 2009. "Revealed Preferences, Choices, and Psychological Indexes," Working Papers 643, Queen Mary University of London, School of Economics and Finance.
    2. repec:cup:judgdm:v:14:y:2019:i:1:p:72-79 is not listed on IDEAS
    3. Ivan Soraperra, 2009. "Revealed Preferences, Choices, and Psychological Indexes," Working Papers 643, Queen Mary University of London, School of Economics and Finance.
    4. Michal Maimaran & Yuval Salant, 2019. "The effect of limited availability on children’s consumption, engagement, and choice behavior," Judgment and Decision Making, Society for Judgment and Decision Making, vol. 14(1), pages 72-79, January.
    5. Nichols, Bridget Satinover, 2012. "The development, validation, and implications of a measure of consumer competitive arousal (CCAr)," Journal of Economic Psychology, Elsevier, vol. 33(1), pages 192-205.

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    Keywords

    Scarcity; Decision-making; Economic behavior;
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