MODELING CONSUMER RISK REDUCTION PREFERENCES FROM PERCEIVED LOSS DATA

For many years the Theory of Perceived Risk has been used to explain consumers' behaviour. One area of interest is the relationship between loss types and the use of risk relievers. Problems with trying to measure the relationship encourage the use of indirect methods. Data on four loss types and 14 risk relievers were collected for 24 products and services and a regression model was used to reveal the relationship between loss types and risk relievers. The constants in the equations altered across products, while the slopes remained the same. The evidence suggests that the model used was incompletely specified and that further testing is necessary.