Practice area: | Behavioural and experimental economics | Behavioural Economics | Business and industry | Consumer and firm behaviour | Consumer behaviour and protection | International institutions | NGOs and consumer advocacy | Public Policy | Regulators and government |
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Client: | N/A |
Published: | August, 2013 |
Keywords: | quantitative analysis |
London Economics was commissioned by the Office of Fair Trading to undertake a behavioural economics study into how partitioned pricing, which is the practice of splitting the price of a good or service into multiple components, affects consumer decision making. The study builds upon earlier research by London Economics for the OFT on the impact of drip pricing, which is a form of partitioned pricing. Both studies show that drip pricing leads to a loss in consumer welfare, and that partitioned pricing practices impact upon consumer search and purchasing behaviour.