Consumer Choices Under Product Option Framing: Loss Aversion Principles or Sensitivity to Price Differentials?

摘要

The effects of options framing can be theoretically explained by lossaversion principles as well as by potential alternative explanations(e.g., sensitivity to price differentials). This paper examines the inter-action effects between option framing and two types of cognitiveconstraints (availability of cognitive resources and additional redun-dant product information) on consumer choices for adding or delet-ing optional product features. In the process, the research attemptsto provide empirical support for one theoretical model (e.g., lossaversion principles) versus the other (e.g., sensitivity to price differ-entials). The results support the hypotheses that consumers choose ahigher number of product options when starting from a fully loadedmodel than from a base model, and that this effect is magnified whenconsumers make choices under high cognitive constraints. In essence,the results empirically support the theoretical premise of the effects ofoption framing being driven by loss aversion principles than by dimin-ished sensitivity to price differentials.