Testing reference dependence, loss aversion and diminishing sensitivity in Spanish tourism

Based on Tversky and Kahneman’s Prospect Theory, we test the existence of reference dependence, loss aversion and diminishing sensitivity in Spanish tourism. To do this, we incorporate the reference-dependent model into a Multinomial Logit Model with Random Parameters -which controls for heterogeneity- and apply it to a sample of vacation choices made by Spaniards. We find that the difference between reference price and actual price is considered to make decisions, confirming that reference dependence exists; that people react more strongly to price increases than to price decreases relative to their reference price, which represents evidence in favor of the loss aversion phenomenon; and that there is diminishing sensitivity for losses only, showing convexity for these negative values.

Direct versus indirect channels: Differentiated loss aversion in a high‐involvement, non‐frequently purchased hedonic product

Purpose – This article aims to investigate whether intermediaries reduce loss aversion in the context of a high-involvement non-frequently purchased hedonic product (tourism packages). Design/methodology/approach – The study incorporates the reference-dependent model into a multinomial logit model with random parameters, which controls for heterogeneity and allows representation of different correlation patterns between non-independent alternatives. Findings – Differentiated loss aversion is found: consumers buying high-involvement non-frequently purchased hedonic products are less loss averse when using an intermediary than when dealing with each provider separately and booking their services independently. This result can be taken as identifying consumer-based added value provided by the intermediaries. Practical implications – Knowing the effect of an increase in their prices is crucial for tourism collective brands (e.g. “sun and sea”, “inland”, “green destinations”, “World Heritage destinations”). This is especially applicable nowadays on account of the fact that many destinations have lowered prices to attract tourists (although, in the future, they will have to put prices back up to their normal levels). The negative effect of raising prices can be absorbed more easily via indirect channels when compared to individual providers, as the influence of loss aversion is lower for the former than the latter. The key implication is that intermediaries can – and should – add value in competition with direct e-tailing. Originality/value – Research on loss aversion in retailing has been prolific, exclusively focused on low-involvement and frequently purchased products without distinguishing the direct or indirect character of the distribution channel. However, less is known about other types of products such as high-involvement non-frequently purchased hedonic products. This article focuses on the latter and analyzes different patterns of loss aversion in direct and indirect channels.

Size-Dependent and Step-Modulated Supramolecular Electrochemical Properties of Catechol-Derived Adlayers at Pt(hkl) Surfaces

The electrochemical reactivity of catechol-derived adlayers is reported at platinum (Pt) single-crystal electrodes. Pt(111) and stepped vicinal surfaces are used as model surfaces possessing well-ordered nanometer-sized Pt(111) terraces ranging from 0.4 to 12 nm. The electrochemical experiments were designed to probe how the control of monatomic step-density and of atomic-level step structure can be used to modulate molecule–molecule interactions during self-assembly of aromatic-derived organic monolayers at metallic single-crystal electrode surfaces. A hard sphere model of surfaces and a simplified band formation model are used as a theoretical framework for interpretation of experimental results. The experimental results reveal (i) that supramolecular electrochemical effects may be confined, propagated, or modulated by the choice of atomic level crystallographic features (i.e.monatomic steps), deliberately introduced at metallic substrate surfaces, suggesting (ii) that substrate-defect engineering may be used to tune the macroscopic electronic properties of aromatic molecular adlayers and of smaller molecular aggregates.