Existing research in building has primarily focused on consumer evaluations of a bundle as a whole. Drawing upon reference price theory and mental accounting theory, this paper investigates the effects of price discounts on consumer evaluations of discounted product in a bundle. It examines how these effects interplay with complementarity of bundle components. The results of three expiremental studies indicate that bundle price discounts hurt consumer evaluations of discounted bundle component, and complementarity of bundle components attenuates these negative effects by altering a consumer's selection of mental accounts in the evaluation process. © 2007 M.E. Sharpe, Inc. All rights reserved.
