A Cross-Cultural Study of Price Search Decisions

Search is an important domain in consumer behavior, and yet cross-cultural differences in search decisions remain a largely unexplored topic. The present study focuses on the following research question: how might cultural background interact with search cost to affect people’s price search behavior, and why? Existing literature provides some relevant clue. A predominant observation in consumer search experiments is that people often do not search sufficiently relative to optimal strategies that maximize expected payoffs, and, in some instances, search approximately optimally. However, Zwick et al. (2003) found a contravening exception of over-searching behavior (only) in their high search cost condition. It has never been completely clarified how such difference from previous results could have occurred. But notably, Zwick et al.’s experiments were conducted with Asian (Hong Kong) subjects, while previous search experiments were largely conducted with subjects from Western cultural backgrounds. Meanwhile, Ackerman and Tellis (2001) found in their field study that Chinese took more time to shop than Americans, a result that corroborates with the possibility that Easterners search more than Westerners in some cases. Hence cross-cultural differences may be a key to resolving the differences between Zwick et al. and previous findings – although any theorizing must explain why that happened only when search costs were sufficiently high.