IS SEEING BELIEVING: INCREASING OWNERS' WILLINGNESS TO SELL BY COUNTERFACTUAL REFERENCE PRICES IN THE SECOND-HAND MARKET

摘要

In the high tech industry, the pace of product replacement is accelerating and thus the prices of any model, especially for its used ones, are often depreciated quickly. Due to the sharp price comparison between the secondhand market prices and the initial purchasing prices, consumers might hesitate to sell their used ones even after they get an upgraded model (Bell and Lattin 2000; Winer 1986). Other obstacles hindering second-hand selling from the owners' side include endowment effect or status quo effect (Kahneman, Knetsh, and Thaler 1980 1985; Thaler 1990) and psychological attachment (Brough and Issac 2012). These might lead to the irrational behaviors of holding a depreciating item for a longer time and eventually realize it at a floor price, which violates the expected utility theory (Friedman and Savage 1948; Keeney and Raiffa 1976). On the other hand, laggards would be expecting to purchase their aspiring items at lower prices in the second-hand market, since companies tend to put the old generation off the shelf in order to protect the pricing and selling of the new launching. Possible aftermaths include social welfare loss, resource waste, and environmental harm (Badu et al. 2007; Hicks et al. 2005).