Many coffee shops encourage sustainability by offering small discounts to customers who bring reusable mugs, though many consumers do not take advantage of the discount. Would a change in price framing at coffee shops increase the use of reusable mugs? The neoclassical law of demand suggests a same-sized discount and fee would not change behavior. The behavioral economic principle of loss aversion suggests that a fee may be more behavior-changing than a discount. To test these competing theories, a 10-week experiment was run at Colorado College. Before the experiment, customers received a $0.25 drink discount if they brought their own mug. The experiment lowered all drink prices by $0.25 and, if customers needed a disposable cup, they were changed an additional $0.25. The prices in both scenarios are the same, but in the first a disposable cup is included in the price and the second frames buying a disposable cup as an additional cost. Results show the experiment did not impact total drinks sold, but reusable mug distribution and the price change increased reusable mug-bringing by 3.8 and 1.9 percentage points respectively.
