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ACR 2010 Special Session Proposal Submission Type: Special Session Submission Title: Standards and Construction of Hedonic Value Co-Chairs: Meng Zhu & Carey Morewedge (Carnegie Mellon University) Address: 5000 Forbes Ave, Pittsburgh, PA 15217, Tel: 412-780-5380 E-mail: [email protected]; [email protected] Papers: Each speaker (underlined below) has agreed to present in the proposed special session 1. The AB Identification Survey: Identifying Absolute versus Relative Determinants of Happiness Christopher K. Hsee & Adelle X. Yang (University of Chicago) 2. Social Standards and the Construction of Hedonic Value Meng Zhu1, Carey Morewedge1, Daniel Gilbert2, Kristian Myrseth3, Karim Kassam2, & Timothy Wilson4 (1Carnegie Mellon University, 2Harvard University, 3EMST, 4University of Virginia ) 3. Absolute and Relative Choices of Maximizers and Satisficers Kimberlee Weaver1, Norbert Schwarz2, Kim Daniloski1, & Keenan Cottone2 (1Virginia Tech, 2 University of Michigan) 4. Integrate or separate future pain? The impact of current pain Eduardo B. Andrade1 , Marco Aurelio Bianchini2 , Newton Lucchiari 2 (1University of California, Berkeley, 2 Universidade Federal de Santa Catarina, Brazil) Special Session Proposal Choices are based on the anticipated utility of experiences—their hedonic value. Correctly anticipating hedonic value is much like hitting a moving target while riding a galloping horse, as (1) anticipated value is constructed by comparison between experiences and imagined, present, and previous experiences, and (2) forecasters inaccurately predict to which standards experiences will be compared (Gilbert & Wilson, 2007; Kahneman & Miller, 1986; Parducci, 1995). Although standards do influence the hedonic value of experiences (Medvec, Madey, & Gilovich, 1995; Zellner, Rohm, Bassetti, & Parker, 2003), the factors that determine the strength of their influence are ambiguous and their influence is often overestimated (Hsee & Zhang, 2004; Novemsky & Ratner, 2003). This symposium takes a close look at the relationship between standards and the construction of hedonic value. In an attempt to gain better understanding of the interplay between standards and hedonic experiences, the papers examine how judgment of and choices between different hedonic experiences are influenced by comparison to absolute standards (i.e., experiences that are inherently evaluable, such as pain) and relative standards (i.e., experiences that have to be evaluated based on external reference information, such as social comparison). Hsee and Yang introduce a simple method to distinguish between absolute vs. relative standards that affect happiness. They propose the AB Identification Survey (ABIS), a simple and practical method to identify whether a given variable exerts an absolute effect on happiness or affects happiness only through social comparison. The authors validated the method and used it on a variety of naturallyoccurring variables. Zhu, Morewedge, Gilbert, Myrseth, Kassam and Wilson show that relative standards (i.e., other people) serve as a potent standard of comparison. They show that social standards evoke hedonic contrasts in situations where non-social standards don’t. They demonstrate that social comparison is sufficient to lead to suboptimal decisions, e.g., choosing low-value, difficult-to-compare options rather than higher-value, easy-to-compare options. Weaver, Schwarz, Daniloski and Cottone further examine the differential influence of absolute vs. relative standards on two types of consumers: maximizers who are concerned with obtaining the best outcome, and satisficers who are more likely to choose the first available option that meets a threshold. They find that maximizers are more likely to choose objectively inferior products and outcomes when they are paired with higher relative standing than satisficers. Finally, Andrade, Bianchini and Lucchiari examine the impact of current pain, an abosulte standard that is inherently evaluable, on people’s preference for integration or separateion of future experiences, in this case, dental treatments. They demonstrate that patients are more likely to integrate future pain. However, the preference for integration of pain is reduced when a “sample” of pain is provided directly before patients make their choice. Taken together, the four papers (all in advanced stages) in this session elucidate the ambiguous relationship between standards and hedonic value, noting when and why predictions and experiences often diverge and lead to suboptimal decisions and fruitless behavior. As the session integrates diverse research, it is expected to appeal to a broad audience, including those interested in happiness and wellbeing, consumer behavior, hedonic value, contrast and assimilation, social comparison and social influences, and judgments and decision making. Talks will be kept brief to allow ample time for audience interaction. Paper Abstracts The AB Identification Survey: Identifying Absolute versus Relative Determinants of Happiness Christopher K. Hsee & Adelle X. Yang (University of Chicago) Short Abstract. This article introduces a simple survey method to distinguish between two types of variables that affect happiness – type A, which exerts an absolute effect on happiness, and type B, which affects happiness only through social comparison. The authors validated the method and used it on a variety of naturally-occurring variables. Long Abstract. Some variables are inherently evaluable and others are inherently inevaluable. To say that a variable is inherently evaluable (for simplicity, call it a type A variable), we mean that human beings have an innate, shared and stable scale to assess which level of the variable is desirable and which is not (ambient temperature, amount of sleep, etc); to say that a variable is inherently inevaluable (type B), we mean that human beings have no innate scale to gauge its desirability and in order to evaluate its desirability one must rely on external reference information, such as social comparison (the size of a diamond, the horsepower of a car, etc). The distinction between type A and type B variables carries important social implications. For instance, improving the value of a type A variable for all the members in a society will absolutely raise the happiness of all, whereas improving the value of a type B variable for all the members in a society is merely a zero sum game and will not raise the happiness of all. Therefore from a congregate point of view, policymakers should direct the resources to improving type A variables in order to increase happiness across time. In this paper we propose the AB Identification Survey (ABIS), a simple and practical method to identify whether a given a variable is type A or type B. The procedure of the ABIS is as follows. Suppose that we wish to identify whether a given variable X, say men’s height, is type A or type B, assuming that greater X is more desirable and that the average X value in the given population is x m, for example, the average height of men is 5’9”. ABIS consists of two versions, the JE version and the simulated-SE version. Each version is simple and contains only two questions. The JE version reads as follows: 1. How tall are you? ____ 2. As you may know, some men are tall and others are short, and men’s average height is about 5’9”. Given that, how do you feel about your height? Give a number between 1 (very unhappy) and 7 (very happy): _____ The simulated-SE version reads as follows: 1. How tall are you? ____ 2. Suppose that you were living in a society where every man were of your height. Given that, how would you feel about your height? Give a number between 1 (very unhappy) and 7 (very happy): _____ Recruit a sample of men (whose height distribution should be representative of that of the target population) and ask half the sample to answer the JE version of ABIS and the other half the simulated-SE version. After data are collected, run two regressions. One regresses the happiness ratings from the JE version of ABIS on the target variable X (e.g., height) and control variables, if any. The other regresses the happiness ratings from the Simulated-SE version of ABIS on X and control variables, if any. Let βJE and βSimulated-SE denote the estimated regression coefficients of X from the two models, respectively. Then we can simply use the following formula to identify whether X is type A or type B: AB coefficient = βSimulated-SE/βJE. βSimulated-SE reflects the non-comparative effect of X, and βJE reflects the total effect of X. Generally speaking, The AB coefficient reflects the size of the non-comparative effect relative to the total effect. The greater the AB coefficient, the more X is a type A variable; the smaller the AB coefficient, the more X is a type B variable. We report three studies. The first study is a validation study. It compares the results of the ABIS with the results of a cleaner but less practical experimental method and shows that the two studies produce very similar results. In addition, we report two studies to show how to apply this method to identifying a series of naturally occurring variables as type A or type B. The first survey was conducted among 453 undergraduate students, the second among 352 business students with work experiences. Our surveys have revealed interesting findings . For undergraduate students, the two top type A variables are vacation time and winter dorm temperature; the two top type B variables are home size and height (meter). For business students, top type A variables were insomnia and vacation time, and top type B variables are income and car price. The ABIS can be used to inform policymakers where to invest resources. From the perspective of an individual, improving either type A variables or type B variables will increase happiness: “I will be happier than you if I can afford more comfortable temperature or I can afford more expensive jewelry.” For that individual, pursuing both type A and type B variables is rational. But from the perspective of a society, improving type B variables is a zero-sum game and only improving type A variables can improve the happiness of all. Since this distinction applies only at the societal level but not at the individual level, policymakers, rather than individuals, are better suited to distinguish type A and type B variables. ABIS is an instrument they can use in this endeavor. Social Standards and the Construction of Hedonic Value Meng Zhu1, Carey Morewedge1, Daniel Gilbert2, Kristian Myrseth3, Karim Kassam2, & Timothy Wilson4 (1Carnegie Mellon University, 2Harvard University, 3EMST, 4University of Virginia ) Short Abstract. We argue that hedonic contrast effects occur when experiences are unengaging or when comparisons are easy to make. We demonstrate that as social comparison is automatic, social standards can evoke hedonic contrasts in situations where non-social standard don’t, and we show that social comparison can lead to suboptimal decisions. Long Abstract. A contrast effect occurs when a standard of comparison influences judgment of a target stimulus, such that the target is considered less like the standard when in its presence than when judged in the absence of that standard. Contrast effects are prevalent in noetic (information based judgments) and psychophysics, yet the evidence for hedonic contrast effects has been mixed (Novemsky & Ratner 2003). We develop an attentional model to explain when and why comparative value influences hedonic value. Specifically, we propose that hedonic contrast effects are particularly elusive in experience because forecasters fail to account for (1) attentional requirements of comparison, as noticing the difference between a standard and a target requires considerable cognitive resources; (2) different attentional requirement of forecasting vs. experience—forecasters’ mental representations of experiences consume fewer resources than having the forecasted experience. Thus, we predict that comparative value will influence hedonic experiences when experiences are unengaging or when comparisons are easy to make. We report four experiments that tested our theory by examining how social comparison, which is automatic, well-practiced and often occurs without conscious awareness, influences hedonic value and decision making. We predict that social standards will evoke hedonic contrast effects in situations where nonsocial standard don’t. Study 1 tested whether social standards produce a greater influence on hedonic value and whether forecasters can correctly predict this difference. Participants were presented two food items, Lay’s Potato Chips (target food) and another item (standard food), either Godiva Raspberry Chocolate (better standard) or King Oscar canned sardines (worse standard). We manipulated social comparison by telling half of the participants that they will be paired with another participant in the same experiment session and each of them will be randomly assigned to sample different food item (partner condition). The other half of the participants were simply assigned to evaluate one of the two food items (no-partner condition). All participants were then assigned by computer to evaluate the target food (potato chips). Experiencers reported how much they enjoyed eating chips and forecasted predicted how much they would enjoy eating chips. As predicted, experiencers in the partner condition rated chips more enjoyable when their partner was assigned to sardines as compared to chocolate, whereas in the no-partner condition, experiencers enjoyed chips the same no matter what the alternative food was. However, forecasters predicted that hedonic contrasts would occur in both the partner and no-partner conditions. To test whether social standards are more influential because comparing to social standards requires fewer attentional resources, Study 2 employed a 2(cognitive load: low vs. high) x 2(standard food: chocolate vs. sardines) design. All participants were paired with another participant and assigned to evaluate chips. To manipulate cognitive load, participants were asked to remember a series of number and letter, either B4 (low load condition) or 8K3YW17L (high load condition) while performing the food evaluation task. In the low load condition, participants enjoyed chips more when their partner was assigned to sardines than chocolate. However, in the high load condition, enjoyment of chips was the same regardless of the standard. These results are consistent with our attention based explanation showing that hedonic contrasts are attenuated when experiencers don’t have enough cognitive resource to pay attention to other people and compare their experiences. Study 3 examined whether hedonic contrast occurs because people compare their experience to the alternative enjoyed by another person or because they compare their imagined happiness to another person. In doing so, we manipulated the modality of standards. We predict that social standards of a different modality will have a weaker effect on the target experience, as it is more difficult to compare to standards of a different modality rather than standards of the same modality. All participants were assigned to eat potato chips and their partners were assigned to experience a superior or inferior alternative. Half of the participants were told that their partners were experiencing either chocolate or sardines (same modality condition); whereas others were told that their partners were listening to a sound clip of either jungle waterfall or vacuum cleaner (different modality condition), which was rated in a pre-test as being as pleasant as chocolate or sardines. We found that hedonic contrast occurred only when partners were experiencing easy-to compare same-modality alternatives, thus supporting our theorization that social standards produce a greater influence on hedonic value because social comparisons are easier not because they are fundamentally different. Study 4 directly tested whether social comparison can lead to suboptimal decisions. We predict that a superior social standard can lead people to choose a lower –value, difficult-to-compare option than a higher-value, easy-to-compare option. Upon arrival, participants were paired with another participant and completed an animal trivial. Participants were then asked to choose a prize from a set of four prizes— two from a superior category (chocolates: Godiva & Hershey’s) and two from an inferior category (snack bars: Granola Bar & Power Bar). Results from a separate pretest indicated that Godiva was ranked as the best prize, Hershey’s was ranked as the 2nd best, Granola Bar was ranked as the 3rd best, and Power Bar was ranked as the worst prize to get for participating in a psychology experiment. In the social comparison condition, participants were told that their partner was randomly assigned to choose first and Godiva was no longer available after being chosen by the partner. In the control, participants was simply asked to choose a prize and told that Godiva was out of stock. Consistent with our prediction, we found that participants in the social condition were more likely to choose the inferior Granola Bar instead of Hershey’s than the control. Absolute and Relative Choices of Maximizers and Satisficers Kimberlee Weaver1, Norbert Schwarz2, Kim Daniloski1, & Keenan Cottone2 (1Virginia Tech, 2 University of Michigan) Short Abstract. Three studies examining tradeoffs between absolute and relative options for consumer goods show that maximizers, decision makers who are concerned with obtaining the best outcome, are more likely to choose objectively inferior products and outcomes when they are paired with higher relative standing than satisficers. Long Abstract. According to the theory of bounded rationality, cognitive and situational limitations can prevent individuals from optimizing or “maximizing” the outcome of many decisions (Simon 1955). Recently, Schwartz et al. (2002) extended these theoretical insights into an individual differences scale. “Maximizers” are consumers who exhaustively examine every possibility before deciding which choice is best, while “satisficers” are more likely to choose the first available option that meets a threshold of acceptability. In the current paper, we investigate a new question that past work has not considered: whether maximizers and satisficers not only differ in the amount of effort they put forth in trying to achieve their standards, but whether they also differ in the type of standard they choose to pursue in consumer choice situations. Past work has remained agnostic about which type of standard maximizers and satisficers emphasize when making decisions (Schwartz et al. 2002; Simon 1955). However, there has been an implicit assumption that maximizers and satisficers are aspiring toward the same standard, and that the major difference between the two types of decision makers is in the amount of effort they expend in trying to achieve it, with maximizers expending more effort and satisficers truncating the search process at an earlier point. In contrast to this implicit assumption, our major hypothesis in the current paper is that maximizers and satisficers may actually aspire toward different standards; with maximizers being more interested in pursuing the relative best, and satisficers more interested in pursuing the absolute best. Generally speaking, there are two types of standards that consumers can use when judging what is “best”: absolute standards and relative standards. To illustrate this distinction, imagine that a consumer can choose to live in one of two possible worlds. In World A, she will drive a car that is a medium quality brand rated 7/10 in parts and performance by Automotive Weekly. Nearly all of her acquaintances will drive cars that are luxury models rated 9/10. In World B, she will drive a car that is a fair quality brand, rated 6/10 in parts and performance by Automotive Weekly. Nearly all of her acquaintances will drive cars that are low quality models rated 4/10. Consumers who aspire toward an absolute standard search for the objectively best outcome and would likely choose to live in World A, since the car the consumer will have is rated more highly than the car they will have in World B (i.e., 7/10 in parts and performance versus 6/10). On the other hand, consumers who aspire toward a relative standard search for an outcome that is best in the relative sense that it exceeds what others have. They would thus prefer to live in World B since the car the consumer will have is better than the cars driven by others (i.e., 6/10 on parts and performance versus 4/10) (Solnick and Hemenway 2005). Results from three studies confirmed hypotheses by showing that maximizers pursue relative standards more than satisficers. Specifically, study 1 showed that maximizers were more willing than satisficers to accept objectively worse products or outcomes when they were paired with superior social position (e.g., Option B above). Studies 2 and 3 sought to establish the psychological mechanism driving the effect by manipulating the public visibility of the decision outcome. If maximizers’ emphasis on social comparison reflects a concern for information about the absolute standards as proposed by past work (Iyengar et al. 2006; Schwartz et al. 2002), then they should choose the same option regardless of whether the outcome of their decision will be publicly visible or not. In contrast, if maximizers are motivated by social rivalry, then the standards they use may shift from public to private contexts. Both studies showed interactions between the maximizer/satisficer variable and the public visibility variable, supporting the social rivalry explanation. Maximizers accepted objectively inferior products that were paired with superior social position more than satisficers in public (e.g., house, car). However, the two groups of decision makers were equally likely to maximize absolute quality when then outcome was private and known only to the decision maker (e.g., pajamas, brand of mattress). The final study also indicated that maximizers prefer counterfeit products –those that have low internal quality, but have the outside appearance of high quality items—more than satisficers. In conclusion, the current results examine a new theoretical question that past work has not considered and show that maximizers and satisficers not only differ in the amount of effort they put forth in trying to achieve their standards, but also differ in the type of standard they choose to pursue in consumer choice situations, with maximizers emphasizing relative standards and satisficers emphasizing absolute standards. In examining this question we bridge two literatures, the first on maximizing and satisficing in decision making and the other on relative and absolute choices, which has been studied in the decision making, psychology and consumer behavior literatures (e.g., Easterlin, 1974; Huguet, 2009; Zhou & Soman 2003). Integrate or separate future pain? The impact of current pain Eduardo B. Andrade1 , Marco Aurelio Bianchini2 , Newton Lucchiari 2 (1University of California, Berkeley, 2 Universidade Federal de Santa Catarina, Brazil) Short Abstract. From plastic to dental surgeries, patients often have the option of undergoing future painful treatments in either a single, or in two or more, periods. In a field experiment, we investigate the extent to which patients’ current level of pain influences preference for integration or separation of future dental treatments. Long Abstract. It is often the case that health-related treatments can take place either in one single, or in two or more, periods (e.g., extract two wisdom teeth). When no clinically dominant option is available, the doctor allows the patient to decide whether to undergo the unpleasant experience all at once or to separate it into multiple events. Although several considerations are at stake, the decision is in part a matter of one’s ability to project and willingness to deal with the future painful experience. Interestingly, patients are often not experiencing any level of pain at the time of the decision (e.g., a teenager who, comfortably seated at the plastic surgeon’s office, decides to undergo breast and nose surgeries all at once). Two questions emerge from this type of scenario: (a) do patients prefer to integrate or to separate future painful treatments? And (b) does the current level of pain influence their preference? In line with previous theoretical suggestions (Kahneman and Tversky 1979; Thaler 1985), we hypothesize that patients are more likely to integrate future pain. However, this preference, we argue, is partially due to the fact that they are often not experiencing any pain at the time of the decision. When pain is experienced at the time of the decision, patients might question their capacity to endure the future unpleasantness all at once (Linville and Fischer 1991). Thus, the preference for integration of pain could be reduced when a “sample” of pain is provided directly before patients make their choice. We tested this possibility in a field experiment in a public dental clinic. Sixty-two patients with periodontal disease in both sides of the mouth (50% male) underwent a sequence of two standard and required dental examinations: one painless (i.e., general clinical exam) and one painful (i.e., pocketing and bleeding on probing exam). Our manipulation simply consisted of randomizing the order of examinations. Half of the patients were randomized to a painless-painful order whereas the order was reversed for the other half. After each dental examination, the patients were asked whether they preferred to have the future periodontal therapy (i.e., scaling and root planing in both sides of the mouth) in either one single intervention or in two interventions performed one week apart from one another. The results show that, in general, patients were more likely to integrate than to separate the future painful experience. However, the preference for integration diminished significantly when they experienced mild levels of pain at the time of the decision. Whereas patients, on average, preferred to integrate future pain after a painless examination, preference for integration did not differ from chance when the decision was made after a painful examination. The effect emerged when comparisons were made within and between subjects. Given that patients’ currently experienced pain can so easily influence their choice, health professionals should be aware of such effects when delegating the choice of future painful experiences to patients. Finally, it is an open question whether visceral information about pain at the time of decision can help patients make choices about integration versus separation with which they will, in retrospect, be more satisfied. References Easterlin, R. A. 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