Price Discrimination against Tourists: Is It Ethical?
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Abstract
Thailand is renowned as one of the world’s most popular tourist destinations; yet, its reputation has been tarnished by the pervasive overcharging of foreign tourists. Theoretically though, price discrimination as a means of maximizing profits is possible when consumers can be grouped according to price elasticities; in this case, locals versus tourists. This study aims to explore the ethical perceptions of price discrimination, from the perspective of the stakeholders involved in the tourism sector of Thailand. Results indicate that price discrimination itself is viewed as being neither ethical nor unethical, it depends on the underlying motives and the nature of the situation. For example, the practice of price discrimination is more acceptable if its motive is for the survival of the business, or when the practice is focused on wealthy tourists. It is the framing, and the intensity of the price difference, however, that play important roles in the ethical perceptions of price discrimination.
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