Work detail

Irationality of consumer choice and the effect of nudging decision-making: A field experiment on tipping

Author: Mgr. Marija Alferovičová
Year: 2016 - winter
Leaders: Václav Korbel Ph.D.
Consultants:
Work type: EEI & EP
Masters
Language: English
Pages: 83
Awards and prizes:
Link: https://is.cuni.cz/webapps/zzp/detail/152256/
Abstract: Human behavior in consumer choice was always an interesting topic for economists
as well as for psychologists. Economists emphasize the importance of utility
theory for decision making, whereas psychologists look for different extrinsic
and intrinsic motivations for particular choices. Finally, both approaches
started to cooperate in a science called behavioral economics. Knowledge of different
factors from economy and psychology that affect our behavior can help,
besides other things, in investigation of tipping. An experiment about tipping
behavior of Czech customers was conducted to explore different motives for
tipping. The tip percentage was related to gender of a waitperson, group size,
size of the bill per person and three independent treatments. Treatments were
associated with altruistic behavior, reciprocity and good mood based on personalized
behavior. The results of the experiment were astonishing and did not
correspond with results from the previous research. It was discovered that altruistic
and reciprocity treatments have negative impact on the amount tipped
and a personalized treatment does not have any effect on tipping percentage.
It is argued that the country of experiment is crucial for such outcomes.
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