Disclosure of Odds Information: An Experimental Investigation of Odds Format and Numeric Complexity

1998 ◽  
Vol 17 (1) ◽  
pp. 11-23 ◽  
Author(s):  
David E. Sprott ◽  
David M. Hardesty ◽  
Anthony D. Miyazaki
Keyword(s):  
Public Policy ◽  
Decision Making ◽  
Experimental Investigation ◽  
Information Provision ◽  
Low Complexity ◽  
Consumer Decision Making ◽  
Policy Initiatives ◽  
Behavioral Decision ◽  
Trade Offs ◽  
Decision Research

Although disclosure of odds information is ubiquitous in the marketplace, no public policy initiatives have been implemented regarding the manner in which odds information should be disclosed. Considering that behavioral decision research has shown that the format of information affects consumers’ processing and evaluation of that information, simply making odds available to consumers in the marketplace does not guarantee that this information is processable or that it aids consumer decision making. After investigating marketplace practices regarding the disclosure of odds information, the authors establish in the first study—an experiment building on basic decision research—that the number-colon-number (i.e., “1:10”) and the phrase (i.e., “One in 10”) formats outperform the decimal (i.e., “0.1”) format, regardless of the numeric complexity or magnitude of the odds information. In the second experiment, the authors investigate a more readily processed format (i.e., a sentence explaining the odds), which is found to increase consumers’ understanding of odds disclosures when presented as a low-complexity number. Implications for public policymakers include several trade-offs that must be made between information provision and cost, as well as between accuracy and processability.

On the Power of a Clear Definition of Rationality

1998 ◽  
Vol 8 (3) ◽  
pp. 477-480 ◽  
Author(s):  
Max H. Bazerman ◽  
David M. Messick
Keyword(s):  
Decision Making ◽  
Clear Definition ◽  
Managerial Decision ◽  
Managerial Decision Making ◽  
Behavioral Decision ◽  
Definition Of ◽  
Decision Research

Abstract:In this paper, we argue that the use of the term “rationality” in Judgment in Managerial Decision Making (JMDM) is extremely useful, and creates a useful dialogue between philosophical and psychological perspectives of ethics and morality. We conclude that while behavioral decision research can gain important insights by more fully including philosophical discussions of rationality, both intellectual communities should be clear in their definitions, provide falsifiable predictions, and offer insights that can be tested empirically. We believe that these are important contributions of behavioral decision research not currently incorporated in philosophical critiques.

scholarly journals Behavioral decision research is not a Linda problem: Comment on Regenwetter, Robinson, and Wang (in press)

2021 ◽  
Author(s):  
David Kellen
Keyword(s):  
Decision Making ◽  
Prospect Theory ◽  
Critical Analysis ◽  
Aggregate Level ◽  
Seminal Paper ◽  
Behavioral Decision ◽  
Linda Problem ◽  
Decision Research

Regenwetter, Robinson, and Wang (in press) argue that research on decision making is plagued with conjunction fallacies or “Linda Effects”. As a case study, they provide a critical analysis of Kahneman and Tversky’s seminal paper on Prospect Theory and its 1992 sequel. This commentary evaluates their criticisms and ultimately finds them to be predicated on a number of misconceptions. As argued below, a reliance on stylized effects at the aggregate level is perfectly legitimate when dismissing a received view and first proposing a new account that organizes said effects in theoretically-meaningful ways.

Fiduciary Law and Psychology

2019 ◽  
pp. 705-722
Author(s):  
Tess Wilkinson-Ryan
Keyword(s):  
Decision Making ◽  
Impression Management ◽  
Risk Perceptions ◽  
Social Dynamics ◽  
Conflicts Of Interest ◽  
Hindsight Bias ◽  
Behavioral Decision ◽  
Law And Psychology ◽  
Intertemporal Discounting ◽  
Decision Research

This chapter considers the psychology of fiduciary law, with particular emphasis on how the principal-agent dynamic affects judgment and decision-making. From a decision-making perspective, a characteristic of fiduciary behavior is that fiduciaries choose for others. Behavioral decision research has focused on the ways that actors decide differently when they are acting for others rather than acting for themselves. To introduce readers to the psychology of self-other decision-making, this chapter reviews the theoretical framework within which these questions have been situated, along with some of the most relevant and intriguing experimental research. Three principal areas of research are discussed: the effect of social distance on the mental operations utilized in judgment under uncertainty; the moral psychology phenomena around navigating conflicts of interest; and the specific social dynamics of deciding in the context of a relationship, whether one-shot or ongoing. The chapter examines the concept of “psychological distance” as an integral component of construal level theory, and the extent to which heuristics and biases are acute for agents and principals. Along the way, Prospect Theory and concepts such as loss aversion, risk perceptions, intertemporal discounting, self-serving biases, disclosure approaches to regulating conflicts of interest, impression management, accountability, and hindsight bias are explored.

Consumer decision making when purchasing eco-friendly apparel

2017 ◽  
Vol 45 (4) ◽  
pp. 404-418 ◽  
Author(s):  
Lori Rothenberg ◽  
Delisia Matthews
Keyword(s):  
Decision Making ◽  
Multinomial Logit Model ◽  
Consumer Decision Making ◽  
Content Type ◽  
Trade Offs ◽  
Young Consumers ◽  
Full Profile ◽  
Realistic View ◽  
Practical Implications ◽  
Made In

Purpose The purpose of this paper is to identify the realistic trade-offs young consumers make when purchasing organic T-shirts. Design/methodology/approach A full profile discrete choice design was used. The data were analysed using a multinomial logit model and desirability indices. Findings Price was the most important attribute to consumers followed by the place of production and then sustainability. Consumers were most willing to purchase T-shirts that are eco-friendly, Made In America, made from wrinkle-free technology and cotton jersey knit fabric, and have a price of $15. Although consumers were most willing to pay $15, some were still willing to pay $25 or even $35 for the same eco-friendly T-shirt. Practical implications Consumers in the current study were more willing to purchase eco-friendly as opposed to organic apparel. The findings suggest that retailers need to consider the language used when communicating with consumers. Also, consumers were more willing to purchase T-shirts Made In America. Retailers may want to promote their domestic manufacturing through in-depth branding and promotions. Originality/value In order to identify the attributes to be used in the current study, labels on T-shirts in stores were examined and then those attributes were verified in the literature. In addition, the inclusion of price as an attribute, rather than as a separate independent question, provides a more realistic view of young consumers’ decision making.

The Information Overload Controversy: An Alternative Viewpoint

1982 ◽  
Vol 46 (2) ◽  
pp. 27-37 ◽  
Author(s):  
Naresh K. Malhotra ◽  
Arun K. Jain ◽  
Stephen W. Lagakos
Keyword(s):  
Public Policy ◽  
Decision Making ◽  
Information Overload ◽  
Consumer Information ◽  
Statistical Testing ◽  
Published Data ◽  
Information Load ◽  
Consumer Decision Making ◽  
Consumer Decision ◽  
Managerial Implications

This paper reviews the information overload controversy and presents a methodology for investigating the effects of information load on consumer decision making performance. The proposed framework enables the statistical testing of specific hypotheses and can incorporate several extensions and refinements. The methodology is illustrated by re-analyzing the published data of previous studies; some interesting findings emerge from the analysis. The paper concludes with some public policy and managerial implications of the consumer information overload concept.

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