Temporal distance and motivation matter: Effects of psychological distance and left-digit in price evaluation

The aim of this article is to explore how the dimensions of psychological distance and motivation impact the left-digit effect in consumer price evaluation. The left-digit effect occurs when the leftmost digit of the prices being compared changes (e.g., $499 vs. $500); the difference between the prices is perceived as larger than if the leftmost digit does not change (e.g., $569 vs. $570). Furthermore, a nine-ending price may be perceived as larger than a price that is actually one dollar higher, when the motivation to process the price information is high and the psychological distance (temporal distance) is near. Likewise, when the motivation to process information is low, regardless of whether the temporal distance is near or far, consumers are also more likely to process information heuristically, strengthening the left-digit effect. However, when the motivation to deal with information is high and the temporal distance is distant, consumers are more likely to process information systematically which tends to diminish the perceived magnitude of the difference due to the left-digit effect.