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Marketing Letters

, Volume 2, Issue 2, pp 99–110 | Cite as

The impact of free and exaggerated prices on perceived quality of services

  • Gerald J. Gorn
  • David K. Tse
  • Charles B. Weinberg
Article

Abstract

Previous research in the price-quality area has largely limited its focus to the normal price range and has concentrated on physical goods almost entirely. This study examines the effect of offering a service for free and at an exaggerated price on the perception of its quality. Consistent with the theory developed in this paper, the experimental results suggest that when the tested services are offered for free and for exaggerated prices, they are perceived as lower in quality than when they are offered in a normal price range.

Key words

Price Quality Service 

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Copyright information

© Kluwer Academic Publishers 1991

Authors and Affiliations

  • Gerald J. Gorn
    • 1
  • David K. Tse
    • 2
  • Charles B. Weinberg
    • 3
  1. 1.The University of British ColumbiaCanada
  2. 2.The University of British ColumbiaCanada
  3. 3.Faculty of CommerceThe University of British ColumbiaVancouverCanada

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