Rational choice
What Dilemma? Moral Evaluation Shapes Factual Belief
Brittany Liu & Peter Ditto
Social Psychological and Personality Science, forthcoming
Abstract:
Moral dilemmas - like the "trolley problem" or real-world examples like capital punishment - result from a conflict between consequentialist and deontological intuitions (i.e., whether ends justify means). The authors contend that people often resolve such moral conflict by aligning factual beliefs about consequences of acts with evaluations of the act's inherent morality (i.e., morality independent of its consequences). In both artificial (Study 1) and real-world (Study 2) dilemmas, the more an act was deemed inherently immoral, the more it was seen as unlikely to produce beneficial consequences and likely to involve harmful costs. Coherence between moral evaluations and factual beliefs increased with greater moral conviction, self-proclaimed topical knowledge, and political conservatism (Study 2). Reading essays about the inherent morality or immorality of capital punishment (Study 3) changed beliefs about its costs and benefits, even though no information about consequences was supplied. Implications for moral reasoning and political conflict are discussed.
----------------------
Christopher Flynn Martin et al.
Caltech Working Paper, April 2012
Abstract:
The capacity of humans and other animal species to think strategically about the likely payoff-relevant actions of conspecifics is not thoroughly understood. Games are mathematical descriptions of canonical ways in which joint choices determine interdependent rewards. Game theory is a collection of ideas about how strategic thinking and learning determine choice. We test predictions of game theory in three simple competitive abstract games with chimpanzee and human participants. Subjects make choices on a dual touch-screen panel and earn food or coin rewards. The chimpanzee and human protocols are closely matched on experimental procedures. The results show that aggregated frequencies of chimpanzee choices are very close to equilibrium points; and choices shift with reward changes almost exactly as predicted by equilibrium theory. Remarkably, chimpanzee choices are closer to the equilibrium prediction than human choices are. Chimpanzee and human choices also exhibit unpredictability on average from trial-to-trial (a property which is adaptive in competitive games), but individual subject-sessions show substantial predictability of choices from past choices and rewards. The results are generally consistent with the cognitive tradeoff hypothesis, which conjectures that some human cognitive ability inherited from chimpanzee kin may have been displaced by dramatic growth in the human neural capacity for language (and perhaps associated skills). As a result, chimpanzees retained the ability, slightly superior to humans, to adjust strategy competitively and in unpredictable ways, conforming remarkably closely to equilibrium predictions from game theory.
----------------------
Money and Thinking: Reminders of Money Trigger Abstract Construal and Shape Consumer Judgments
Jochim Hansen, Florian Kutzner & Michaela Wanke
Journal of Consumer Research, forthcoming
Abstract:
The idea of money reminds consumers of personal strength and resources. Such cues have been found to increase the level of mental construal. Consequently, it was hypothesized and found in five experiments that reminders of money trigger abstract (versus concrete) mental construals. Participants were primed with money or money-unrelated concepts. Money primes caused a preference for abstract over concrete action identifications (experiment 1), instigated the formation of broader categories (experiment 2), and facilitated the identification of global (versus local) aspects of visual patterns (experiment 3). This effect extended to consumer judgments: Money primes caused a focus on central (versus peripheral) aspects of products (experiment 4) and increased the influence of quality of parent brands in evaluations of brand extensions. Priming with little money (experiment 3) or expenditures (experiment 5) did not trigger abstract construals, indicating that the association between money and resources drives the effect.
----------------------
When Time Flies: How Abstract and Concrete Mental Construal Affect the Perception of Time
Jochim Hansen & Yaacov Trope
Journal of Experimental Psychology: General, forthcoming
Abstract:
Time is experienced as passing more quickly the more changes happen in a situation. The present research tested the idea that time perception depends on the level of construal of the situation. Building on previous research showing that concrete rather than abstract mental construal causes people to perceive more variations in a given situation, we found in 3 studies that participants in a concrete mind-set experienced time as passing more quickly than participants in an abstract mind-set. In 2 further studies we demonstrated that the level on which actual changes happen in a given situation moderated this effect: Changes in high-level aspects mainly affected time estimation of participants primed with an abstract mind-set, whereas changes in low-level aspects affected time estimation of participants primed with a concrete mind-set.
----------------------
Małgorzata Gocłowska & Richard Crisp
Thinking Skills and Creativity, forthcoming
Abstract:
School-based psychological interventions which require students and pupils to think of counter-stereotypic individuals (e.g., a female mechanic, a Black President) have been shown to reduce stereotyping and prejudice. But while these interventions are increasingly popular, no-one has tested whether tasks like this can have benefits beyond promoting tolerance, particularly with respect to the way individuals think and solve problems. We looked at one such intervention and asked whether this task could, in addition to decreasing propensities to stereotype others, contribute to more flexible and original performance. We expected that because exposure to people who disconfirm stereotypes compels students to think "out of the box", they will subsequently not only rely less on stereotypes, but in more general thinking rely less on easily accessible knowledge structures and be more flexible and creative. As predicted, being encouraged to think counter-stereotypically not only decreased stereotyping, but also, on a divergent creativity task, lead to the generation of more creative ideas - but only for individuals who initially reported a lower Personal Need for Structure.
----------------------
Felt Understanding and Misunderstanding Affect the Perception of Pain, Slant, and Distance
Shigehiro Oishi, Jamie Schiller & Blair Gross
Social Psychological and Personality Science, forthcoming
Abstract:
We conducted two studies to examine whether the psychological states of felt understanding and misunderstanding would affect people's basic perceptions such as pain, geographical slant, and distance. As predicted, an experimentally induced sense of felt understanding relative to misunderstanding increased pain tolerance marginally and reduced the perceived distance to the target locations significantly. In Study 2, we not only replicated Study 1's findings on pain tolerance and distance perception but also found that participants in the understanding condition perceived the same hill to be significantly less steep than those in the misunderstanding condition. Our studies demonstrated that the experimentally induced feeling of misunderstanding tends to have the aversive effect on the perception of pain, geographical slant, and distance, whereas the experimentally induced feeling of understanding tends to alleviate pain, reduce the geographical slant, and the perceived distance to a target location.
----------------------
Self-other decision making and loss aversion
Evan Polman
Organizational Behavior and Human Decision Processes, November 2012, Pages 141-150
Abstract:
In eight studies, we tested the prediction that making choices for others involves less loss aversion than making choices for the self. We found that loss aversion is significantly lessened among people choosing for others in scenarios describing riskless choice (Study 1), gambling (Studies 2 and 3), and social aspects of life, such as likeably and status (Studies 4a-e). Moreover, we found this pattern in relatively realistic conditions where people are rewarded for making desirable (i.e., profitable) choices for others (Study 2), when the other for whom a choice is made is physically present (Study 3), and when real money is at stake (Studies 2 and 3). Finally, we found loss aversion is moderated when factors associated with self-other differences in decision making are taken into account, such as decision makers' construal level (Study 4a), regulatory focus (Study 4b), degree of information seeking (Study 4c), omission bias (Study 4d), and power (Study 4e).
----------------------
Hope to be Right: Biased Information Seeking Following Arbitrary and Informed Predictions
Aaron Scherer, Paul Windschitl & Andrew Smith
Journal of Experimental Social Psychology, forthcoming
Abstract:
Five studies tested when and why individuals engage in confirmatory information searches (selective exposure) following predictions. Participants engaged in selective exposure following their own predictions, even when their predictions were completely arbitrary (Studies 1 and 3). The selective exposure was not simply the result of a cognitive bias tied to the salience of a prediction option (Study 2). Instead, it appears that making a prediction - regardless of how ill-informed a person is while making the prediction - can cause the person to anticipate enjoyment from being right (Studies 4 and 5) and to select new information consistent with that outcome. The results establish a desirability account that can explain post-prediction selective exposure effects even in cases when defense motivations, pre-existing differences, or positive-test strategies can be ruled out as explanations.
----------------------
Inaction inertia, the sunk cost effect, and handedness: Avoiding the losses of past decisions
Jonathan Westfall, John Jasper & Stephen Christman
Brain and Cognition, November 2012, Pages 192-200
Abstract:
Strength of handedness, or the degree to which an individual prefers to use a single hand to perform various tasks, is a neurological marker for brain organization and has been shown to be linked to episodic memory, attribute framing, and anchoring, as well as other domains and tasks. The present work explores the relationship of handedness to both inaction inertia (the inclination to resist an action after previously bypassing a similar action) as well as to the sunk cost effect (the tendency to continue to engage in a behavior after an initial investment of time or money has been made). In Experiment 1, mixed-handers displayed a larger inaction inertia effect than strong-handers. In Experiment 2, they displayed a larger sunk cost effect than strong-handers. Experiments 3 and 4 extended the sunk cost finding into a different domain and explored how mixed- and strong-handers react to additional information designed to increase the comparative advantage of terminating, rather than continuing, a failed project. Overall, we found that mixed-handers were more likely to show inertia effects because of an increased aversion to losses. The results of Experiment 4 suggest that, when provided with additional information that made it clear that continuing a project would be a greater loss than terminating it, mixed-handers no longer showed a larger sunk cost effect than strong-handers, highlighting the importance of carefully considering exactly how sunk cost scenarios are worded and providing additional information on how mixed- and strong-handers differ in belief updating.
----------------------
Misplaced Confidences: Privacy and the Control Paradox
Laura Brandimarte, Alessandro Acquisti & George Loewenstein
Social Psychological and Personality Science, forthcoming
Abstract:
We test the hypothesis that increasing individuals' perceived control over the release and access of private information - even information that allows them to be personally identified -- will increase their willingness to disclose sensitive information. If their willingness to divulge increases sufficiently, such an increase in control can, paradoxically, end up leaving them more vulnerable. Our findings highlight how, if people respond in a sufficiently offsetting fashion, technologies designed to protect them can end up exacerbating the risks they face.
----------------------
Effects of perspective and belief on analytic reasoning in a scientific reasoning task
Erin Beatty & Valerie Thompson
Thinking & Reasoning, forthcoming
Abstract:
The purpose of these studies was to test the hypothesis that changing perspectives from one's own to another's promotes the engagement of analytic processing and, in turn, reduces the impact of beliefs. In two experiments participants evaluated research vignettes containing belief-consistent and belief-inconsistent conclusions, and indicated whether the data supported a correlation between two variables. Consistent with our hypothesis, the tendency to endorse correlations consistent with prior belief was reduced when participants evaluated the data from the researcher's perspective relative to their own. We also administered the Actively Open Minded Thinking (AOT) scale (Stanovich & West, 2007, 2008), which did not predict belief effects on our task. We did however observe that the AOT was reliably associated with different response strategies: high AOT scorers were more inclined to choose ambiguous response options, such as "no conclusion is warranted", whereas low scorers evinced a preference for more determinate options (e.g., there is no relationship between the two variables). We interpret our findings in the context of dual process theories of reasoning and from a Bayesian perspective.
----------------------
Cognition in the woods: Biases in probability judgments by search and rescue planners
Kenneth Hill
Judgment and Decision Making, July 2012, Pages 488-498
Abstract:
A type of emergency decision-making which has not received research attention is the police search for a lost person in a rural or wilderness area. For many such incidents, decisions concerning where to search for the lost subject are made by a planning team, each member of which assigns probabilities to the various hypotheses about where the subject might be located, including the residual hypothesis that the subject is somewhere else entirely, that is, outside of the designated search area. In the current study, 32 adult males with search planning experience were asked to assign probabilities to a fictional lost person incident. It was hypothesized, according to support theory (Tversky & Koehler, 1994), that subjects who first considered the five possible scenarios accounting for how the subject could have left the search area - i.e., unpacked the residual hypothesis - would subsequently increase their probability estimate of the global hypothesis that the missing subject was not in the designated search area, compared to those subjects who unpacked the focal hypothesis. This hypothesis was confirmed. We also found considerable evidence for subadditivity, as most subjects estimated higher summed probabilities for the individual scenarios accounting for the focal and residual hypotheses, respectively. The potential negative consequences of such unpacking effects during a lost person incident were discussed, and possible means of mitigating such effects were described.
----------------------
Abandoning a label doesn't make it disappear: The perseverance of labeling effects
Francesco Foroni & Myron Rothbart
Journal of Experimental Social Psychology, forthcoming
Abstract:
Labels exert strong influence on perception and judgment. The present experiment examines the possibility that such effects may persist even when labels are abandoned. Participants judged the similarity of pairs of silhouette drawings of female body types, ordered on a continuum from very thin to very heavy, under conditions where category labels were, and were not, superimposed on the ordered stimuli. Consistent with earlier research, labels had strong effects on perceived similarity, with silhouettes sharing the same label judged as more similar than those having different labels. Moreover, when the labels were removed and no longer present, the effect of the labels, although diminished, persisted. It did not make any difference whether the labels were simply abandoned or, in addition, had their validity challenged. The results are important for our understanding of categorization and labeling processes. The potential theoretical and practical implications of these results for social processes are discussed.
----------------------
Explanation Fiends and Foes: How Mechanistic Detail Determines Understanding and Preference
Philip Fernbach et al.
Journal of Consumer Research, forthcoming
Abstract:
People differ in their threshold for satisfactory causal understanding and therefore in the type of explanation that will engender understanding and maximize the appeal of a novel product. Explanation fiends are dissatisfied with surface understanding and desire detailed mechanistic explanations of how products work. In contrast, explanation foes derive less understanding from detailed than coarse explanations and downgrade products that are explained in detail. Consumers' attitude toward explanation is predicted by their tendency to deliberate, as measured by the Cognitive Reflection Test. Cognitive reflection also predicts susceptibility to the illusion of explanatory depth, unjustified belief that one understands how things work. When explanation foes attempt to explain, it exposes the illusion leading to a decrease in willingness to pay. In contrast, explanation fiends are willing to pay more after generating explanations. We hypothesize that those low in cognitive reflection are explanation foes because explanatory detail shatters their illusion of understanding.
----------------------
Physiological evidence of attraction to chance
Marc Adam & Eike Kroll
Journal of Neuroscience, Psychology, and Economics, August 2012, Pages 152-165
Abstract:
While economic models of risky choice assume a concave utility function for gains, experimental evidence reveals situations where otherwise risk-averse decision makers show risk-seeking behavior. In this article, we analyze a specific effect called attraction to chance and discuss the role of emotions in risky decision making as an explaining factor for this particular effect. In an experiment, we replicate the behavioral results on attraction to chance from a previous study and add physiological measures for the choice process. We find that attraction to chance can be explained by differences in emotions the subjects experience during the dynamic processes of different types of lotteries. These emotions can be cognitively reflected by the decision maker at the moment of choice and incorporated in expected utility. Therefore, we show the necessity to account for the fact that decision makers perceive lotteries as dynamic processes rather than as indivisible realizations of random variables.
----------------------
Managers and Students as Newsvendors
Gary Bolton, Axel Ockenfels & Ulrich Thonemann
Management Science, forthcoming
Abstract:
We compare how experienced procurement managers and students solve the newsvendor problem. We find that managers broadly exhibit the same kind of pull-to-center bias as students do. Also, managers use information and task training no better than students. The performance of managers is positively affected by the level of their education and their level in the organizational hierarchy. We discuss implications for theory and for how ordering might be improved in practice.
----------------------
Confidence and Construal Framing: When Confidence Increases versus Decreases Information Processing
Echo Wen Wan & Derek Rucker
Journal of Consumer Research, forthcoming
Abstract:
A large literature demonstrates that people process information more carefully in states of low compared to high confidence. This article presents an alternative hypothesis that either high or low confidence can increase or decrease information processing on the basis of how information is construed. Five experiments demonstrate two sets of findings supporting this alternative formulation. First, low confidence leads people to focus on concrete construals, whereas high confidence leads people to focus on abstract construals. Second, people in a state of low confidence view messages framed in a concrete manner as more relevant and thus engage in greater processing of messages framed concretely; in contrast, people in a state of high confidence view messages framed in an abstract manner as more relevant and thus engage in greater processing of messages framed abstractly. These results enrich the literature by providing a fundamental shift in understanding how psychological confidence influences information processing.
----------------------
David Hardisty, Kirstin Appelt & Elke Weber
Journal of Behavioral Decision Making, forthcoming
Abstract:
Intertemporal tradeoffs are ubiquitous in decision making, yet preferences for current versus future losses are rarely explored in empirical research. Whereas rational-economic theory posits that neither outcome sign (gains vs. losses) nor outcome magnitude (small vs. large) should affect delay discount rates, both do, and moreover, they interact: in three studies, we show that whereas large gains are discounted less than small gains, large losses are discounted more than small losses. This interaction can be understood through a reconceptualization of fixed-cost present bias, which has traditionally described a psychological preference for immediate rewards. First, our results establish present bias for losses - a psychological preference to have losses over with now. Present bias thus predicts increased discounting of future gains but decreased (or even negative) discounting of future losses. Second, because present bias preferences do not scale with the magnitude of possible gains or losses, they play a larger role, relative to other motivations for discounting, for small magnitude intertemporal decisions than for large magnitude intertemporal decisions. Present bias thus predicts less discounting of large gains than small gains but more discounting of large losses than small losses. The present research is the first to demonstrate that the effect of outcome magnitude on discount rates may be opposite for gains and losses and also the first to offer a theory (an extension of present bias) and process data to explain this interaction. The results suggest that policy efforts to encourage future-oriented choices should frame outcomes as large gains or small losses.
----------------------
Matching Contributions and Savings Outcomes: A Behavioral Economics Perspective
Brigitte Madrian
NBER Working Paper, July 2012
Abstract:
Including a matching contribution increases savings plan participation and contributions, although the impact is less significant than the impact of nonfinancial approaches. Conditional on participation, a higher match rate has only a small effect on savings plan contributions. In contrast, the match threshold has a substantial impact, probably because it serves as a natural reference point when individuals are deciding how much to save and may be viewed as advice from the savings program sponsor on how much to save. Other behavioral approaches to changing savings plan outcomes - including automatic enrollment, simplification, planning aids, reminders, and commitment features - potentially have a much greater impact on savings outcomes than do financial incentives, often at a much lower cost.
----------------------
Neurocircuits underlying cognition-emotion interaction in a social decision making context
Shaun Ho et al.
NeuroImage, forthcoming
Abstract:
Decision making (DM) in the context of others often entails complex cognition-emotion interaction. While the literature suggests that the ventromedial prefrontal cortex (vmPFC), striatum, and amygdala are involved in valuation-based DM and hippocampus in context processing, how these neural mechanisms subserve the integration of cognitive and emotional values in a social context remains unclear. In this study we addressed this gap by systematically manipulating cognition-emotion interaction in a social DM context, when the participants played a card game with a hypothetical opponent in a behavioral study (n = 73) and a functional magnetic-resonance-imaging study (n = 16). We observed that payoff-based behavioral choices were influenced by emotional values carried by face pictures and identified neurocircuits involved in cognitive valuation, emotional valuation, and concurrent cognition-emotion value integration. Specifically, while the vmPFC, amygdala, and ventral striatum were all involved in both cognitive and emotional domains of valuation, these regions played dissociable roles in social DM. The payoff-dependent responses in vmPFC and amygdala, but not ventral striatum, were moderated by the social context. Furthermore, the vmPFC, but not amygdala, not only encoded the opponent's gains as if self's losses, but also represented a "final common currency" during valuation-based decisions. The extent to which emotional input influenced choices was associated with the functional connectivity between the value-signaling amygdala and value integrating vmPFC, and also with the functional connectivity between the context-setting hippocampus and value-signaling amygdala and ventral striatum. These results identify brain pathways through which emotion shapes subjective values in a social DM context.