Should consumers request cost transparency?
Abstract
Purpose
The purpose of this paper is to propose that consumer choice be guided by price fairness judgements to increase consumer satisfaction and subsequently enhance market efficiency. Consumers en masse lack the information to judge price fairness, thereby causing their ability to influence the economy to be overlooked.
Design/methodology/approach
This is an argumentative and conceptual work that aims to initiate a debate on this important yet unexplored issue. The arguments presented in the paper are based on economic and technological considerations.
Findings
The measure for enabling a consumer price fairness judgement is unit cost information – the cost incurred by a firm to produce a product and/or service. The benefits and challenges stemming from the availability of unit cost information (i.e. cost transparency) to consumers and companies are presented and the likely impact of cost transparency on addressing information asymmetries between buyers and sellers are discussed.
Originality/value
Although a significant body of knowledge exists on issues such as price transparency and how it is driven and enabled by the growth of the Internet, there is little or no evidence of research yet on issues related to cost transparency. The authors believe this work would create a new line of research for scholarly community leading to an impact on practice.
Keywords
Acknowledgements
The authors would like to acknowledge the helpful comments of the anonymous reviewers and editor on earlier versions of this article.
Citation
Simintiras, A.C., Dwivedi, Y.K., Kaushik, G. and Rana, N.P. (2015), "Should consumers request cost transparency?", European Journal of Marketing, Vol. 49 No. 11/12, pp. 1961-1979. https://doi.org/10.1108/EJM-02-2015-0086
Publisher
:Emerald Group Publishing Limited
Copyright © 2015, Emerald Group Publishing Limited