Friday, March 4
2:00pm – 3:30pm EST
2:00pm – 3:30pm EST
Discussant: Philip Fernbach (University of Colorado-Boulder)
MC: Alice Moon (University of Pennsylvania)
Calendar Invite: Add to calendar
Student Coordinator: Donald Gaffney (Vanderbilt University) (donald.r.gaffney@Vanderbilt.Edu)
Nine preregistered studies (N=2,589) conducted in the field, lab, and online document a tendency to reject opportunities with low probability of success, even when objectively costless and with only upside. Across studies, between 23.0% to 56.4% of participants exhibited opportunity neglect, driven by their feeling of having “nothing to gain.”
Source Memory is More Accurate for Subjective Claims than for Objective Claims
Source memory, the ability to link a claim to its original source, is an essential aspect of accurate recall, attitude formation, and subsequent decision making. We predict that claim objectivity affects source memory during encoding and accuracy during subsequent recall. Across seven pre-registered experiments (N=3,308) and a variety of consumer environments we investigate the effect of claim objectivity on source memory. We find that source memory is more accurate for subjective opinions than for objective factual statements, indicating that opinions are more likely to be correctly attributed to their sources than are factual statements.
Attributions of Credit, Blame, and Luck Depend on Perceived Nature of Uncertainty
People are routinely judged based on the outcomes of their predictions. In this paper we argue that the perceived nature of uncertainty critically influences ascription of credit, blame, and luck to forecasters. In one archival study and five lab studies, we demonstrate that epistemic (knowable) uncertainty is associated with attributions of credit for correct predictions and blame for incorrect predictions, whereas aleatory (random) uncertainty is associated with attributions of good luck for correct predictions and bad luck for incorrect predictions.
When Preference Uncertainty Meets Outcome Uncertainty: Inflated Probability Estimates of Favorable Outcomes
We show that when a product has uncertain outcomes (e.g., uncertain of the color a hair dye product will result in), consumers with uncertain (vs. certain) preferences (e.g., what hair color they prefer) predict a higher probability of preference match, although normatively, this probability should be independent of preference uncertainty. This occurs because the subjective probability of preference match under outcome uncertainty depends on the number of unique “samples” of preference match people can mentally simulate.
The Denominator Effect: The Impact of Denominator Magnitude on Probability Judgment
In this research, we present evidence for the opposite of the denominator neglect by investigating the situations where the psychological distance from a risky outcome makes people rely on the denominator more than they do on the numerator when evaluating ratio information.
Keeping Options Open: How Decision Reversibility Dampens Satisfaction with Choices based on Quality
Attending to consumers’ preference for reversible decisions, firms offer increasingly lenient yet costly return and cancellation policies. Despite preferring reversible decisions, consumers end up less satisfied with choices they can reverse. Thus, retailers are in a catch-22 – reversible decisions attract customers yet diminish their satisfaction. Addressing this impasse, we propose that how reversibility affects post-choice satisfaction depends on whether decisions are a matter of taste or quality. An analysis of 40 000 Airbnb listings and four experiments reveal that (1) although consumers predict more satisfaction with reversible decisions, they experienced less satisfaction with their choice when it is based on quality (but not taste), (2) framing decisions around taste attenuates the negative effect of reversibility on satisfaction. Thus, making decisions more irreversible increases satisfaction. The findings reveal boundary conditions of decision reversibility’s detrimental effects on satisfaction and facilitate optimal return and cancellation policy design and message framing.
Visual Entropy and Consumer Creative Success
Our work studies a new antecedent of consumer creativity – visual entropy, a measure of information intensity and the extent of uncertainty within a closed microsystem (e.g., an image). Across five empirical studies, we apply novel methodologies by incorporating various creative materials (e.g., colored pencils, molding clay), creativity tasks (e.g., toy design, alien creature making), and evaluations of visual entropy (i.e., computer-vision-based computation) and creative outcomes (e.g., expert rating, and machine-learning-based text mining). Results show that both dimensions of entropy - spatial structure entropy and compositional order entropy - of creative materials layout, enhance consumer creativity by activating the divergent thinking mode, consistent with the “honing theory of creativity” (Gabora 2017). We further show that the beneficial effect of visual entropy on creativity is stronger for customers with more versus less experience in the creative domain.
How Many Failures Before Success? On Intuitions For The First Occurrence of An Uncertain Event
"People sometimes must predict when an uncertain event will occur for the first time. For example, someone searching for a job has a small chance of being hired every day but maybe most interested in when the first offer will come. We investigate intuitions for the first occurrence of an uncertain event. Although, mathematically, an uncertain event is most likely to first happen on the first trial, we find that people do not realize this, particularly when the event probability is low. We find that, instead, people substitute different, often irrelevant, attributes of the problem, leading to suboptimal answers."
Not Having Control Makes People Choose Monthly Subscriptions: Role of Decision Uncertainty
People often feel that they are not in control of their lives. We examine how this loss of control affects people’s consumption behavior, particularly in the context of subscription commerce. Using four studies, we find how low perceived control leads to higher subscription intent for monthly subscriptions (yearly subscriptions). We further explain how decision uncertainty mediates this effect. Our research contributes to the literature of perceived control by finding a novel consequence of reduced control in subscription intent. Also, the findings suggest that at the onset of the pandemic, consumers might be susceptible to suboptimal decision-making.
Are Individuals’ Risk Perceptions in The Social Domains Similar to Those in The Financial Domains?
While much of the literature about loss aversion comes from studies conducted in the financial domain, there is still much to learn about how people react to risk in different contexts. This paper investigates systematic differences in risk preferences between financial and social contexts. Studies 1 and 2 found that in the social domain people tend to be more risk-seeking in the gain frame than in the loss frame, but in the financial domain, people are more risk-seeking in the loss frame than in the gain frame. If selected for a Flash Talk, I will talk about Study 2.