Abstract

http://ssrn.com/abstract=929944
 
 

References (49)



 
 

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Medium Maximization


Christopher K. Hsee


University of Chicago - Booth School of Business

Frank Yu


China Europe International Business School

Jiao Zhang


University of Chicago - Booth School of Business

Yan Zhang


University of Chicago - Booth School of Business


Journal of Consumer Research, Vol. 30, 2003

Abstract:     
A medium - for example, points or money - is a token people receive as the immediate reward of their effort.It has no value in and of itself, but it can be traded for a desired outcome. Experiments demonstrate that, when people are faced with options entailing different outcomes, the presence of a medium can alter what option they choose. This effect occurs because the medium presents an illusion of advantage to an otherwise not so advantageous option, an illusion of certainty to an otherwise uncertain option, or an illusion of linearity to an otherwise concave effort-outcome return relationship. This work has implications for how points influence consumer choice and how money influences human behavior.

Number of Pages in PDF File: 14

Keywords: decision-making, loralty program, utility construction, consumer satisfaction

JEL Classification: D11, D12, D81, D91

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Date posted: October 11, 2006  

Suggested Citation

Hsee, Christopher K. and Yu, Frank and Zhang, Jiao and Zhang, Yan, Medium Maximization. Journal of Consumer Research, Vol. 30, 2003. Available at SSRN: http://ssrn.com/abstract=929944

Contact Information

Christopher K. Hsee (Contact Author)
University of Chicago - Booth School of Business ( email )
5807 S. Woodlawn Avenue
Chicago, IL 60637
United States
Fang Yu
China Europe International Business School ( email )
Shanghai-Hongfeng Road
Shanghai 201206
Shanghai 201206
China
Jiao Zhang
University of Chicago - Booth School of Business ( email )
5807 S. Woodlawn Avenue
Chicago, IL 60637
United States
Yan Zhang
University of Chicago - Booth School of Business ( email )
5807 S. Woodlawn Avenue
Chicago, IL 60637
United States
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