Abstract
An experiment demonstrated that, when comparing prices in DM and Euro, people estimated price increases in Euro, although the prices were the same in both currencies and were directly comparable. Participants compared the prices of two menus (one with DM prices, one with Euro prices) in a 2 x 2 experimental design. The prices in Euro were either 15 percent higher than in DM or were the same. For half of the participants, an incentive was given for an accurate estimate, whereas no incentive was given for the remaining half. In all conditions, participants were biased in their price estimations: the -average estimated price trend was higher than the real price trend. Expectations of price trends were positively correlated with final price trend estimations
Translated title of the contribution | The Introduction of the Euro: The Effects of Expectations on Price Trend Estimations |
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Original language | German |
Pages (from-to) | 22-28 |
Number of pages | 7 |
Journal | Wirtschaftspsychologie |
Volume | 2002 |
Issue number | 4 |
Publication status | Published - 2002 |
Externally published | Yes |
Keywords
- Euro
- financial psychology
- price estimation
- biases
Fields of Science and Technology Classification 2012
- 501 Psychology