Everyone knows that prices are negotiable at Israel’s open-air marketplaces. Prices posted in the shuk are merely a starting point for discussion. And competition is high because there are many vendors offering identical stock.
But not everyone can successfully bargain down prices. It seems to depend on how you look and whether you’re male or female.
Undercover shoppers in a recent Israeli study found that fresh produce vendors (96 percent of them male) in 23 markets offered larger and more frequent discounts to women than to men.
The more attractive the female buyer, the larger and more frequent the discount offered. Male shoppers’ attractiveness made no difference at all.
Overall, male buyers obtained a discount on 26% of their requests, compared to 40% of female buyers’ requests. The mean percentage discount obtained by female buyers was 5.18% compared to 2.45% for male buyers.
Economics professors Zeev Shtudiner (Ariel University, Israel) Bradley J. Ruffle (McMaster University, Canada) and Arie Sherman (Ruppin Academic Center, Israel) reported their findings in the Journal of Behavioral and Experimental Economics.
“We trained 90 buyers [44 males and 46 females] and sent them to produce markets across Israel. After verifying a product’s posted price, they asked for a discount on a one-kilogram or one-unit purchase,” the authors explain.
“Predominantly male vendors employ third-degree price discrimination: women are offered larger and more frequent discounts than men, and the more attractive the female buyer, the larger and more frequent the discount offered. No other buyer characteristic is a significant predictor of the likelihood or size of a discount.”
Indeed, the buyer’s perceived wealth, kindness, intelligence or ethnicity were not found to be significant predictors of their chances to get a discount on fruits, vegetables, nuts, seeds, herbs or spices.
The attractiveness and other perceived traits of the buyers were rated by 577 students looking at their photographs.
“The near absence of price-information sharing among buyers in these markets permits vendors to price at a markup and to grant individual requests for a discount without fear of inviting an onslaught of additional takers,” the authors write.
“The finding that the mostly male vendors in our sample willingly lower their posted prices in response to the buyer’s gender and, to a lesser extent, their looks attests to this markup and their willingness to employ it at their discretion.”