Online Consumers’ Perception on Price Fairness

This study adopts illusion of control and lateral consumer relationship to investigate their effects on price fairness in online auction and group buying context. These two variables have been known to have strong influences in fairness perception on human decision making processes and outcomes. Through laboratory experiments, this study demonstrates that consumers’ perception on illusion of control in price determination and advantageous lateral consumer relationship significantly affect price fairness perception in both the online auction and group buying environments. The findings are expected to provide researchers and managers with useful insights to conduct future studies on uncovering the nomological networks associated with price fairness perception and to develop better pricing strategies and design effective dynamic pricing mechanisms.