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Title:The power of apology PDF Logo
Authors:Abeler, Johannes
Calaki, Juljana
Andree, Kai
Basek, Christoph
Issue Date:2009
Series/Report no.:CeDEx discussion paper series 2009-12
Abstract:After an unsatisfactory purchase, many firms are quick to apologize to customers. It is, however, not clear why they should do that. As the apology is costless, it should be regarded as cheap talk and thus ignored by the customer. In this paper, we test in a controlled field experiment whether apologizing in fluences customers' subsequent behavior. We find that apologizing yields much better outcomes for the firm than offering a monetary compensation.
Subjects:apology
credulity
natural field experiment
JEL:C93
D82
L81
Document Type:Working Paper
Appears in Collections:CeDEx Discussion Paper Series, The University of Nottingham

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