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Published May 2015 | Published + Supplemental Material
Journal Article Open

Loss Aversion in Post-Sale Purchases of Consumer Products and Their Substitutes


This paper considers the measurement of consumer loss aversion in product markets. We introduce a test based on a "substitution effect," focusing on how the end of a sale affects sales not of the good itself, but a substitute good. Such an effect cannot be easily confounded with consumer stockpiling. Using a unique dataset from an online hardware retailer, we find evidence consistent with consumer loss aversion. Moreover, we find that less experienced consumers suffer a more prominent loss aversion bias compared to more experienced consumers.

Additional Information

© 2015 American Economic Association. Thanks to HSS and the BNDF for support.

Attached Files

Published - loss_aversin_in_post_sales.pdf

Supplemental Material - P2015_1037_data.zip

Supplemental Material - Shum-readme.pdf


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