Price Cognition Explains Why Consumers Remember Some Prices Better Than Others

Abstract : We examine to what extent consumers' recall for the prices of products they frequently purchase is determined by the structure of the price itself. We address questions such as whether certain combinations of digits lead to a higher likelihood of recall? Do certain price endings trigger rounding, and therefore errors in recall? Are absolute recall errors larger for higher prices or do recall errors remain proportional to the price level? A series of hypotheses is developed based on previous research in the area of numerical cognition. These hypotheses highlight the role of language and monetary units and we therefore test them in a comparison of recall performance in three countries, France, Hungary and the United States.