Why should I pay more? Testing the impact of contextual cues on perception of price unfairness for the price-disadvantaged segment in dual pricing

Abstract

Abstract The practice of dual pricing is ubiquitous in the field of tourism. However, extant research has not focused on minimising the perception of price unfairness among the price-disadvantaged tourists. This study uses equity theory (Adams, 1965), categorisation theory, and the principle of dual entitlement to understand the impact of price as well as non-price related contextual cues on the perception of price unfairness among the price-disadvantaged (international) tourists. The results demonstrate that transaction similarity between the two (domestic and international) segments can be reduced by expressing international tourists’ entrance fees in international currencies, and by including a service element, which would decrease their perception of price unfairness. Furthermore, providing a legitimate rationale behind the increased entrance fee would further decrease their perception of price unfairness. Implementing these findings will help tourist sites in reducing the negative impact of the perception of price unfairness.