DOES INCOME INFLUENCE RATIONAL DECISIONS?

Huai Chun Lo, Ming Jing Yang, Cheng Tsu Huang, Ching Yuan Chien

Research output: Contribution to journalReview articlepeer-review

Abstract

This study explores the impact of income on customer loyalty so as to verify whether consumer decision-making is bounded by rationality or not. The empirical findings show that income positively affects customer loyalty in choosing leisure parks. Specifically, high-income customers prefer to reduce the time cost of information collection. Therefore, they are more inclined to choose a specific resort or a leisure activity park of a particular brand rather than spend their time searching and planning for the most appropriate location of a leisure activity park. This result supports the notion that customers’ consumption decisions are bounded by rationality, not for the purpose of making the optimal decision, but in order to pursue satisfying their own needs instead.

Original languageEnglish
Pages (from-to)185-198
Number of pages14
JournalEconomic Horizons
Volume24
Issue number2
DOIs
StatePublished - 1 May 2022

Keywords

  • bounded rationality
  • decision choices
  • income
  • loyalty
  • rational decision

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