TITLE:
The Effects of Altruism and Social Background in an Online-Based, Pay-What-You-Want Situation
AUTHORS:
Hanna Peschla, Augustin Suessmair, Gerd Meier
KEYWORDS:
Pay-What-You-Want, Altruism, Social Background, Charity, Willingness-to-Pay, Participative Pricing
JOURNAL NAME:
American Journal of Industrial and Business Management,
Vol.7 No.3,
March
31,
2017
ABSTRACT: Pay-What-You-Want (PWYW) is a participative pricing mechanism that leaves
it up to the customer to choose a purchase price. Presently, the factors that
influence customers’ willingness to pay are still not completely understood.
This study examines the degree to which willingness to pay in an anonymous PWYW
purchase situation on the Internet is influenced by the social motif of altruism
and communication that as a part of the purchase price, will be donated to a
charitable institution identified in advance. We hypothesized that altruism as
well as a social background exerted an increasing impact on willingness to pay.
A specific purchase situation in which the social background was manipulated was
simulated by using online surveys. Altruism was measured using a 7-point Likert-type
scale. The sample consisted of 403 participants, predominantly students and
young adult employees. We found that communication of a social background led
to a highly significant increase in willingness to pay (p p