The Economics of Drip Pricing

A conference on the economics of drip pricing

FTC Conference Center 601 New Jersey Avenue, NW, Washington, DC 20001 | Directions & Nearby

Conference Description

Drip pricing is a pricing technique in which firms advertise only part of a product’s price and reveal other charges later as the customer goes through the buying process. The additional charges can be mandatory charges, such as hotel resort fees, or fees for optional upgrades and add-ons. Drip pricing is used by many types of firms, including internet sellers, automobile dealers, financial institutions, and rental car companies.

Economists and marketing academics will be brought together to examine the theoretical motivation for drip pricing and its impact on consumers, empirical studies, and policy issues pertaining to drip pricing. The sessions will address the following questions: Why do firms engage in drip pricing? How does drip pricing affect consumer search? Where does drip pricing occur? When is drip pricing harmful? Are there efficiency justifications for the practice in some situations? Can competition prevent firms from harming consumers through drip pricing? Can consumer experience or firm reputation limit harm from drip pricing? What types of policies could lead to improved consumer decision making and under what circumstances should such policies be applied?

The workshop, which will be free and open to the public, will be held at the FTC’s Conference Center, located at 601 New Jersey Avenue, N.W., Washington, DC. A government-issued photo ID is required for entry. Pre-registration for this workshop is not necessary, but is encouraged, so that we may better plan for the event.

At the workshop, FTC Chairman Jon Leibowitz asked consumers to share their drip pricing stories with the FTC. Consumers can call us at 1-877-FTC-HELP.

 

PRE-REGISTRATION:

Pre-registration for this workshop is not necessary, but is encouraged, so that we may better plan for the event.

To pre-register: please email your name and affiliation to DripPricingRegistration@ftc.gov.

NOTE: When you pre-register, we will collect your name, affiliation, and your email address. This information will be used to estimate how many people will attend. We may use your email address to contact you with information about the workshop.

 

FOR ADDITIONAL INFORMATION CONTACT:

Mary Sullivan (Conference Organizer)
Bureau of Economics
msullivan@ftc.gov
202-326-3200

Aleksey Verkhivker (Assistant Organizer)
Bureau of Economics
averkhivker@ftc.gov
202-326-3018

Event Details

FTC Privacy Policy

Under the Freedom of Information Act (“FOIA”) or other laws, we may be required to disclose to outside organizations the information you provide when you pre-register. The Commission will consider all timely and responsive public comments, whether filed in paper or electronic form, and as a matter of discretion, we make every effort to remove home contact information for individuals from the public comments before posting them on the FTC website.

The FTC Act and other laws we administer permit the collection of your pre-registration contact information and the comments you file to consider and use in this proceeding as appropriate. For additional information, including routine uses permitted by the Privacy Act, see the Commission’s comprehensive Privacy Policy.