CONSUMER EVALUATIONS OF MULTIPLE VERSUS SINGLE PRICE CHANGE

This article examines how consumer evaluations of multiple price chang es differ from the evaluation of a single price change of an equal amo unt. Consistent with R. Thaler's theory about segregation versus integ ration of gains and losses, we find that multiple price decreases are evaluated more favorably than a single price decrease and multiple pri ce increases are evaluated more unfavorably than a single price increa se. However, these effects are moderated by consumer price uncertainty and relative magnitude of the prices being evaluated. Because price-u ncertain consumers consider higher ranges of prices acceptable, they a re less unfavorable to multiple price increases and more favorable to multiple price decreases than certain consumers. Moreover, when the ma gnitude of one price is very small relative to other prices, consumers ' preference for multiple price decreases (relative to a single price decrease) is reduced. However, this effect is not found when there are price increases.