Abstract:

Based on affection effect and framing effect of Behavioral Economics, we explored consumers’ trade-ins behavior and their different action mechanism. We conducted a 3×2×2 between-subjects experiment and verified that when rational and have preference consistency, consumers attached more importance to new products’ purchase price; due to affection effect, they thought highly of the old products’ selling price; because of the framing effect arising from limited cognition, enhanced information would influence consumers’ preference between old and new products; the main factor was consumers’ personality, namely consumer innovation, while the affection effect and framing effect had moderating effect.

Key words: Behavioral Economic Theory, Trade-Ins, Affection Effect, Framing Effect, Consumer Innovation