Chivas Regal effect

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The marketing phenomena for the mindset that if something costs more, it must be more desirable. This effect is most often attributed to the price of private universities in the US. For example, because Harvard University costs $40,000 per year to attend, it must be better than a college that costs $10,000 per year to attend, all other factors being equal. This effect is also commonly applied to prestige consumer goods. It was originally a reference to a particular alcoholic beverage Chivas Regal. The company found that by raising the price of the beverage, they could increase sales.

This effect is mentioned in the following Time magazine article: http://www.time.com/time/magazine/article/0,9171,137412,00.html

The effect is described in the following book: "unSpun: Finding Facts in a World of Disinformation" by Brooks Jackson and Kathleen Hall Jamieson