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    Customer anger and incentives for quality provision

    Heyes, A. and Kapur, Sandeep (2012) Customer anger and incentives for quality provision. Working Paper. Birkbeck College, University of London, London, UK.

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    Abstract

    Emotions are a significant determinant of consumer behaviour. A customer may get angry if he feels that he is being treated unfairly by his supplier and that anger may make him more likely to switch to an alternative provider. We model the strategic interaction between firms that choose quality levels and anger-prone customers who pick their supplier based on their expectations of suppliers' quality. Strategic interaction can allow for multiple equilibria including some in which no firm invests in high quality. Allowing customers to voice their anger on peer-review fora can eliminate low-quality equilibria, and may even support a unique equilibrium in which all firms choose high quality.

    Metadata

    Item Type: Monograph (Working Paper)
    Keyword(s) / Subject(s): anger, customer attrition, quality
    School: Birkbeck Schools and Departments > School of Business, Economics & Informatics > Economics, Mathematics and Statistics
    Depositing User: Administrator
    Date Deposited: 11 Jan 2013 11:11
    Last Modified: 17 Apr 2013 12:33
    URI: http://eprints.bbk.ac.uk/id/eprint/5944

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