Individual Consumers

SYNOPSIS

Individual consumers as well as managers within any

organisation regularly make purchasing decisions. Some of

these decisions will relate to product or service markets

that are characterised by homogeneity in all aspects

except price. There may be a benefit, therefore, from

searching for a lower price. The bulk of this thesis is

concerned with investigating individual search behaviour

when making purchases in such circumstances. After a

comprehensive review of formal search models, together

with the corresponding experimental evidence, a series of

new experiments are described that, in particular,

uncover several heuristics that might govern search

behaviour in practice. A large number of simulated

purchases is used to assess the performance of these

heuristics in comparison with the optimal, theoretical

model. A related judgemental bias - functional fixation -

is also reviewed in detail and tested experimentally.

Finally, the understanding of individual search behaviour

is further developed using a research experiment set in a

more complex, and less highly structured, business

decision context.

iv

ACKNOWLEDGEMENTS

I would like to thank Professor Kevin Keasey (University

of Leeds) for his constructive and enthusiastic

supervision of this thesis, Mr. Andrew Martin (University

of Warwick) for his invaluable assistance on the price

search studies, Professor John Hey (University of York)

for his helpful suggestions concerning the experiments

reported in chapter 5 and chapter 9, and several members

of the Department of Accounting and Finance within the

Warwick Business School and the Department of Accounting

and Commercial Law within the Economics Faculty at the

University of Sydney, for their support, encouragement