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An empirical investigation of framing effects in negotiations: A study of single‐family home sales
Author(s) -
Witte Carl L.,
Grünhagen Marko,
Gentry James W.
Publication year - 2008
Publication title -
psychology and marketing
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.035
H-Index - 116
eISSN - 1520-6793
pISSN - 0742-6046
DOI - 10.1002/mar.20220
Subject(s) - negotiation , framing (construction) , real estate , prospect theory , advertising , marketing , equity (law) , empirical research , economics , business , microeconomics , sociology , political science , finance , social science , philosophy , structural engineering , epistemology , law , engineering
This paper integrates Prospect Theory and the concept of framing in a study of consumer negotiated pricing in a real estate context. Building on previously conducted experimental designs, a field survey indicated that home sellers using sales price as a reference point display greater willingness to make concessions than those who use equity as their reference point. Further, the third‐party influence of the realtor was shown to alter Prospect Theory predictions so that even equity‐based sellers became concessionary. © 2008 Wiley Periodicals, Inc.