1、 CONSUMER FINANCIAL PROTECTION BUREAU|APRIL 2024 Price Complexity in Laboratory Markets Prepared by Dustin Beckett 1 Table of contents Table of contents.1 Executive Summary.2 1.Introduction.3 1.1 Related Literature.5 2.Complexity Experiment.7 2.1 The Model.7 2.2 The Experiment.8 2.3 Measures and Hyp

2、otheses.12 2.4 Data.16 2.5 Findings.18 3.Competition Experiment.35 3.1 The Model and the Experiment.36 3.2 Data.36 3.3 Measures and Hypotheses.37 3.4 Findings.38 4.Conclusion .45 References .47 Appendix A:The Gettysburg College lab.50 Appendix B:The Experimental Procedure.51 Appendix C:Treatment Blo

3、cks.53 2 Executive Summary The paper reports on two laboratory experiments that investigated the effects of price complexity on market outcomes.The experiments had human participants interact in basic markets.Across experiment sessions,the experiments varied how complex sellers were allowed to make

4、their prices.In treatment 1,sellers could describe their price only using a single number.In treatment 2,sellers described their products using up to eight“sub-prices,”prices that added up to one total price.And,in treatment 3,sellers could use up to 16 sub-prices.1.Allowing more complex pricing led

5、 sellers to ask for higher total prices,on average.Comparing one price and 16 sub-price markets,average seller asks increased by more than 60 percent.2.Allowing more complex pricing led buyers to make more mistakes,on average.Comparing one price and 16 sub-price markets,the frequency of buyer mistak

6、es increased by more than 16 percentage points,or almost 1,400 percent.3.Allowing more complex pricing led to higher transaction prices,on average.Comparing one price and 16 sub-price markets,average prices increased by more than 70 percent.4.In markets with multiple sub-prices,sellers can compete f