Society for Judgment and Decision Making 1997 Annual Meeting

Poster Session #2

P2-1. Tiffany BARNETT (Fuqua Sch. of Business, Duke Univ.)

Making tough decisions that count: The moderating role of trust on information processing in complex decision making.

In this study, we investigate the impact of trust on consumers' information processing and search behavior in high stakes, complex decisions. The study addresses the following questions: Does having a trustworthy service provider to share decision making responsibilities with significantly impact the amount and depth of processing in which consumers engage (i.e., are consumers more likely to rely on heuristics)? If so, is the importance of trust more or less meaningful as decisions become less complex? Lastly, how does the impact of established trust in a service relationship differ when there is no trust or an active element of distrust.

P2-2. Marlene MORRIS (Fuqua Sch. of Business, Duke Univ.)

Effects of product innovation and decision-related emotion on consumer decision avoidance.

The focus of the present research is on the effects of affective influences (decision-related emotion, attitudes) and product innovativeness on consumer decision making and likelihood of decision avoidance. Two proposed contributions of this research are, first, an examination of the construct of product innovativeness, identifying two distinct categories: newness of the product and degree of continuous innovation. A second contribution will be an examination of the effects of decision-related emotion on conflict and decision avoidance. Possible interactions between product innovativeness and decision-related emotion are predicted and will be examined.

P2-3. Sue O'CURRY (Dept. of Marketing, DePaul Univ.), & Ching-Fan SHEU (Dept. of Psychology, DePaul Univ.)

Reference price formation: Which variables matter?

We report the results of several studies designed to explore reference price formation. Using an experimental approach derived from psychophysics, we presented subjects with price sequences varying in regularity, proportion of time on discount, depth of discount, shape of sequence, and presence or absence of brand name. We elicited reference prices and ranges of normal price. The data indicate that depth of price cut has a significant impact on estimates of price. In addition, branding leads to higher estimates of the least upper bound of the price range, pointing to a significant role for non-price information in reference price formation.

P2-4. Carla C. CHANDLER, Leilani A. GREENING, & Leslie ROBISON (Dept. of Psychology, Washington State Univ.)

How base rates frame personal risk judgments.

When women judge their risk of getting osteoporosis, their estimates tend to be much lower than the stated base rate (50%) because they believe that they have a better-than-average family history. In contrast, risk judgments tend to match the stated values if the base rates are contingent on family history (e.g., the risk is 55% for those who have a family history of osteoporosis and 45% for those who do not). While contingent base rates provide a frame that constrains risk judgments, they do not make women more worried about osteoporosis and thus may not influence personal decisions.

P2-5. Judith L. REESE, Sandra L. SCHNEIDER, Theresa E. HNATH-CHISOLM, & Harvey B. ABRAMS (Univ. of South Florida)

Message framing and intervention approach to encourage hearing aid use.

Hearing aid use can reduce the handicapping effects of hearing loss and improve quality-of-life in older, hearing impaired individuals; yet, hearing aids are underutilized by this group. A counseling intervention to persuade them to use hearing aids was assessed. Both message frame (i.e., negative, positive or minimal) and intervention approach (i.e., prescribed treatment or optional service) were manipulated. Results suggest that the negatively framed message with either approach was especially influential in getting participants to keep their hearing aids, as was the prescribed treatment approach when combined with a minimal message. The positively framed message was generally ineffective.

P2-6. Celia E. WILLS (Coll. of Nursing, Michigan State Univ.), & Colleen F. MOORE (Dept. of Psychology, Univ. of Wisconsin-Madison)

Judgments of likelihood and confidence for antidepressant medication acceptance.

Students (N=89) rated likelihood and confidence for accepting an antidepressant medication based on efficacy and risk of nausea information presented in hypothetical consent-for-treatment forms. Ratings were made for four different formats of nausea base rate risk information for positive and negative frames. A framing effect occurred for likelihood ratings for positive versus negative frames. Students who made ratings for only one frame were more likely to have zero variability in likelihood and confidence ratings than students who made ratings for both frames. Likelihood and confidence ratings were correlated positively. Implications for health risk communications and informed consent will be described.

P2-7. Kristina G. GORBATENKO-ROTH (Dept. of Psychology, Univ. of Wisconsin-Stout), & Irwin P. LEVIN (Dept. of Psychology, Univ. of Iowa)

Capturing patients' judgment policies in weighting different domains of quality of life.

The goal was to determine how individual differences in weighting the following domains of quality of life account for overall differences in patients' evaluation of medical outcomes: physical functioning, emotional functioning, and role (job) functioning. "Policy capturing" methodology was used in which medical patients rated their anticipated satisfaction with each of a series of hypothetical scenarios defined by varying levels of functioning on each of the three domains. Regression analysis showed that a model which incorporated individual differences in domain weighting significantly outperformed a model which placed equal weight on each of the three domains of quality of life.

P2-8. Mandeep K. DHAMI, & Peter AYTON (Dept. of Psychology, City Univ., London)

A policy capturing study of magistrates' bail decision making.

The policy capturing method developed in social judgement theory was used to examine magistrates' bail decisions. A sample of magistrates made bail decisions upon hypothetical cases and then ranked the cues according to their relative importance in making their decisions. Policy capturing research has consistently found that: (a) linear models can quite accurately represent the judge; (b) judges utilise a small number of cues; (c) judges are inconsistent; (d) there are inter-individual differences in policies; and (e) judges lack insight into their policies. The results of this study are discussed in relation to these findings. The practical implications are also discussed.

P2-9. Patrik N. JUSLIN (Dept. of Psychology, Uppsala Univ., Sweden)

Judgment analysis of emotional communication in music performance.

Music performers are able to communicate specific emotions to listeners. The performers use a number of cues in the performance to generate the emotional expression, and listeners employ the same cues in their judgments of the expression. However, to improve the communicative process it is necessary to relate encoding to decoding aspects. In this study, multiple regression was applied to the relationships between (a) the performer's intention and the cues, and (b) the listener's judgment and the cues. The two systems were related using the Lens Model Equation. The results show how performers can become better at communicating emotions to listeners.

P2-10. Ellen PETERS (Univ. of Oregon), & Paul SLOVIC (Univ. of Oregon and Decision Research)

Impact of emotional information in complex decisions.

Emotional information is predicted to loom larger in complex than simple decisions, particularly for individuals who tend to be high in emotional processing. Subjects are presented with simple and complex pairs of options. One option - the emotional option - is preferred for noninstrumental, emotional reasons while the other option - the analytical option - is preferred for instrumental reasons. Complex decisions include additional attribute information. Emotional information weighed more heavily in complex decisions - the emotional option was chosen more often in complex than simple decisions. Individuals high (as compared to low) in tendency towards emotional processing showed this effect more strongly.

P2-11. Lisa J. ABENDROTH (Fuqua Sch. of Business, Duke Univ.)

Regrettably so: The effects of justification, action, and outcome knowledge on regret.

This research examines how reasoning during the decision process interacts with action/inaction and outcome knowledge to influence regret. The first experiment found that action/inaction distinctions had no effect on the justifiability of reasons and that the valence of an outcome affected bad reasons only. Results of the two main experiments indicated that good reasoning provides insulation against regret only when the more favorable, alternative outcome is unknown. In addition to replicating the commission bias when no reasons were provided, results from the third experiment revealed that perceived effort may mediate the effect action has on regret.

P2-12. Monica D. BARNES, & Sandra L. SCHNEIDER (Dept. of Psychology, Univ. of South Florida)

The relationship between omission and status quo biases and affective reactions to lottery outcomes.

218 subjects participated in a lottery where they had the opportunity to win or lose a small prize. Prior to the lottery, participants could either move (act) or stay (fail to act) and either switch their endowed status quo prize (change status quo) or keep it (maintain status quo). Using a questionnaire, participants' affective reactions were assessed both immediately and one week after the lottery. No effects were found for regret, but there was an omission bias for satisfaction. Results are discussed in comparison to previous anticipatory scenario studies of regret and satisfaction.

P2-13. Léonie E. M. GERRITSEN, & Gideon B. KEREN (Eindhoven Univ. of Technology, The Netherlands)

How does information about choice options influence regret and disappointment?

In a series of experiments, we examined how pre- and postdecisional information influences the intensity of experienced regret and disappointment. Results show that predecisional information, a manipulation of whether a negative outcome was foreseeable or not, only influenced the intensity of regret. Postdecisional probabilistic information, given a negative outcome, influenced the intensity of both regret and disappointment, although in opposite ways. Results will be discussed in the context of regret and disappointment theories.

P2-14. Gal ZAUBERMAN, & Dan ARIELY (Fuqua Sch. of Business, Duke Univ.)

The moderating role of evaluation goals on sequential effects: The relationship between hedonic and informational evaluation.

This work examines the effects of the evaluation goals (Hedonic and Informational) on the final retrospective evaluation of experiences. Specifically, we examine different characteristics of the experience's pattern and their role in impacting its overall evaluation under these two goals. The pattern parameters used are, Initial information, Peak intensity, Final information, and Rate of change. Different intensity patterns were used in order to estimate the effect of these parameters. The results indicate that evaluations under the two modalities are different with respect to the parameters noted above. In other words, the evaluation mode systematically impacts the way information over time is integrated.

P2-15. Carla M. KMETT (Univ. of Dayton), Hal R. ARKES (Ohio Univ.), & Steven K. JONES (Air Force Academy)

The influence of two decision aids on high school students' satisfaction with their college choice.

Recent research suggests that examining the bases of one's decisions can lower subsequent satisfaction with the outcome of those decisions. We predicted the contrary result in a field study using high school students' college choice. Some students used no decision aid, some used a pro/con list, and some used a computer program in making their actual college choice. The two aids resulted in significantly higher outcome satisfaction when assessed after one college term. However this result was found only among those students whose initial bases for their decision were less accessible on a subsequent memory test.

P2-16. Laura HUTZEL, & Hal R. ARKES (Dept. of Psychology, Ohio Univ.)

Regret may be a fuel for inaction inertia.

Some participants reported their propensity to buy shoes for $90 after missing an initial opportunity to buy them for either $80 or $40. Other participants reported the amount of regret they felt over missing the initial opportunity. The availability of the initial opportunity varied by three locations: Columbus, Ohio; St. Louis; or Southeast Asia. When the missed deal was great and available, regret was high and propensity to buy was low. When the missed deal was not so great and/or not available, regret was low and the propensity to buy was high. We hypothesize that regret fuels inaction inertia.

P2-17. Hal R. ARKES, & Laura HUTZEL (Dept. of Psychology, Ohio Univ.)

The role of probability of success estimates in the sunk cost effect.

Arkes and Blumer (1985) demonstrated that those who want to continue investing in a failing course of action inflate its estimated probability of success [p(s)]. Participants rated a project's p(s) either before or after making an investment decision. The latter group manifested a significantly higher p(s) than the former, suggesting that inflating the p(s) retroactively "rationalizes" the prior investment decision rather than mediates the investment decision. Also, compared to participants who didn't want to invest, those who did thought that such an investment would be significantly more influential in promoting the project's success.

P2-18. Elmer Anita THAMES (John Carroll Univ.)

The effect of mental accounting, endowment, and sex on the sunk-cost effect.

This study examined how sunk-cost effects vary with mental accounting, endowment, and sex. Subjects' decision to reinvest, decision confidence, annoyance at paying the reinvestment cost, and disappointment at missing the investment event were assessed. There were significant effects for sunk-cost and mental-accounting manipulations as well as an interaction between them. Decision makers' sex also produced significant effects. Endowment manipulations did not reach significance.

P2-19. Bennett CHERRY, Lisa ORDÓÑEZ, & Stephen GILLILAND (Dept. of Management and Policy, Univ. of Arizona)

Grade expectations: The effects of expectations on fairness and satisfaction.

Subjects judged the satisfaction and fairness of grades in either a hypothetical, laboratory context or in an actual classroom situation. Expectations of grades were manipulated in the lab study and measured in the field study. The results indicate that, contrary to Equity Theory, grades exceeding expectations were judged to be equally fair as grades meeting expectations. However, lower than expected grades were judged to be unfair. Satisfaction judgments for the same stimuli showed loss aversion.

P2-20. Lisa ORDÓÑEZ, Terry CONNOLLY, & Richard COUGHLAN (Dept. of Management and Policy, Univ. of Arizona)

Multiple reference points in pay satisfaction assessments.

MBA students judged the satisfaction and fairness of salary offers given to a hypothetical MBA graduate. Subjects were presented with information about offers received by one or two other graduates with similar backgrounds as well as the offer to the focal graduate. Both satisfaction and fairness ratings were consistent with subjects comparing the offer with other offers one at a time and then combining the feelings associated with these comparisons.

P2-21. Michael E. WALKER (Ohio State Univ.), & Osvaldo F. MORERA (Univ. of Illinois, Chicago)

Disparate WTA/WTP disparities? The influence of human vs. natural causes.

Contrary to predictions of economic theory, evidence suggests the value associated with willingness to accept compensation (WTA) for a product far exceeds the value to pay (WTP) for that object (Knetsch and Sinden, 1984). In the context of compensation for damage, cause of damage (human versus naturally-occurring) influences estimates for both WTA (Ritov and Baron, 1990) and WTP (Kahneman, Ritov, Jacowitz, and Grant, 1993). In this study, subjects provided WTA and WTP judgments in scenarios where cause of damage was either human or natural. Results suggest interactions between type of value judgment and context may influence WTA/WTP disparities.

P2-22. David V. BUDESCU, Kristine M. KUHN, Karen KRAMER, James HERSHEY, & Adrian RANTILLA (Dept. of Psychology, Univ. of Illinois at Urbana-Champaign)

Tradeoffs in risk attributes: The joint effects of dimension preference and vagueness.

Previous research has demonstrated that people are generally averse to imprecisely specified (vague) probabilities and/or outcomes. The current research investigated the joint effects of vagueness in both dimensions. Subjects provided Certainty Equivalents for vague and precise positive gambles over a wide range of probabilities and outcomes. Imprecise probabilities and outcomes were equated in terms of their effects on the gambles' expected values, providing a meaningful metric for comparison. We found slight vagueness avoidance for probabilities and quite strong preference for vague outcomes. A general model of decision making with vaguely specified attributes that captures this pattern is proposed.

P2-23. Kristine M. KUHN, & David V. BUDESCU (Dept. of Psychology, Univ. of Illinois at Urbana-Champaign)

Reversal of preferences for vagueness in risky decision making.

This study demonstrates response mode effects in expressed preferences for vagueness. We analyzed individual and group data from two studies where subjects evaluated hypothetical risks, of equal expected loss, by using direct choice and ratings of individual options. We found (1) a greater tendency to express indifference via ratings, and (2) stronger vagueness avoidance in ratings than choice. Choice depends primarily on the mean values of the two dimensions, whereas ratings are also affected by the relative precision of the probabilities and outcomes. This suggests that the precision with which attributes are specified functions as a secondary (less prominent) dimension.

P2-24. Mary E. HUNEKE, Wendy S. FORBES, Irwin P. LEVIN (Univ. of Iowa), & J. D. JASPER (Univ. of Toronto)

Comparing decision processes in set formation and final choice.

Process tracing measures were derived from an information search and monitoring task in which some subjects were asked to form a set of options for later consideration; others made only a final choice; and others used a "phased narrowing" task in which they first formed a consideration set and then made a final choice from this set. The following issues were addressed: 1) Processing differences between set formation and choice; 2) Inclusion vs. exclusion processes in set formation; and 3) Trade-offs in effort devoted to set formation and final choice.

P2-25. Melissa L. FINUCANE (Decision Research), Murray T. MAYBERY, & Dan MILECH (Univ. of Western Australia)

Behavioral decision theories: Competing or complementary?

Typically, decision researchers adopt a priori one model of individuals' decision strategies, and fit data to the model. Consequently, over-fitting of the data is common and the relative explanatory power of alternative models is ignored. Two studies are reported, demonstrating a technique for directly comparing strategies from two traditionally competing explanations of decision making: information integration theory and simplification theory. The findings showed that different strategies from the two theories are used reliably, and that the type of decision problem influences strategy selection. Rather than competing, the theories complement each other in explaining how individuals make decisions for a range of decision problems.

P2-26. Murray T. MAYBERY (Univ. of Western Australia), Melissa L. FINUCANE (Decision Research), & Dan MILECH (Univ. of Western Australia)

On the importance of value trees in the evaluation process: Do superstructure and detail matter?

Value trees generated using multiattribute utility technology are useful in assessing conflict over the importance of different pieces of decision information. Previous research on the effects of tree construction confounded the manipulation of superstructure and detail with changing the surface structure context in which attributes were weighted. In the present study, relative importance weights were elicited from 64 participants for attributes organised in trees that differed in superstructure and detail, but held constant the surface structure context. The results indicated that weights were influenced greatly by attribute detail, but only to a limited extent by changes in superstructure.

P2-27. Linda R. ELLIOTT (Armstrong Laboratories), John R. HOLLENBECK (Michigan State Univ.), & Philip T. DUNWOODY (Univ. of Georgia)

Conflicting information in simultaneous and sequential displays: Patterns of decision error in a multiple-cue threat assessment task.

Complex information is increasingly represented using visual displays configured to enhance perception, comprehension, and decision making. In this study, we expected to distinguish patterns of decision error based on existence of conflicting information and simultaneous versus sequential display of information. We predicted that a sequential display of information would be more likely to result in primacy error, consistent with Anchoring and Adjustment theory. In contrast, decision making in a simultaneous display condition was predicated to be characterized by an averaging heuristic, reflecting a tendency to process information more holistically (Hammond et al. 1987). Results supported hypotheses as predicted.

P2-28. Robert P. MAHAN, Philip T. DUNWOODY (Univ. of Georgia), & Linda R. ELLIOTT (Crew Technology, Armstrong Labs)

Effects of representation fidelity on judgment simulation performance: More is different.

In training simulation research, the more fidelity achievable, the better the simulation is assumed to depict the task. However, altering a simulation representation may fundamentally alter task properties, as well as the responses to the task. This study demonstrated that a threat assessment simulation presented in a low fidelity numeric format versus a higher fidelity graphical format produced two distinct performance profiles. Here, the Numeric format supported highest performance under low complexity conditions, while, the graphical version supported highest performance under higher complexity conditions. The outcomes appear related to the organizing principles activated by the different formats. The results suggest that performance measures geared to specific organizing principles induced by format should be considered integral to any simulation development program.

P2-29. Robert M. ROE (Purdue Univ.), Stephen E. EDGELL, & William P. NEACE (Univ. of Louisville)

Sequential versus simultaneous presentation of information in a probabilistic, decision-making-like environment.

Three studies explored the effect of presenting two information dimensions simultaneously or sequentially in a probabilistic, decision-making-like environment. With varying presentation order, the utilization of a single relevant dimension was less with sequential presentation. However, with a constant order of presentation this effect occurred only when the irrelevant dimension was presented first. If the pattern and one dimension were relevant, the effect was small for utilization of the dimension, but larger for utilization of the pattern.