The Situationist

Posts Tagged ‘choice paradox’

Sheena Iyengar on “The Multiple Choice Problem”

Posted by The Situationist Staff on December 4, 2009

Sheena Iyengar is a professor in the Management Division of the Columbia Business School. One of the world’s experts on choice, Professor Iyengar received a dual degree from the University of Pennsylvania in 1992, consisting of a B.S. in Economics from the Wharton School of Business and a B.A. in psychology with a minor in English from the College of Arts and Sciences. In 1997 she completed her Ph.D. in social psychology from Stanford University. Her dissertation, entitled “Choice and its Discontents,” received the prestigious Best Dissertation Award for 1998 from the Society of Experimental Social Psychology.  Since then, she has published many articles in academic journals and her research has been commonly cited in the popular media.  Iyengar is at work on a book exploring the mysteries of choice in everyday life.

At the third annual conference on Law and Mind Sciences, which took place im March of 2009, Professor Iyengar’s outstanding presentation was titled “The Multiple Choice Problem.”  Here’s the abstract:

It is a common supposition in modern society that the more choices, the better—that the human ability to manage, and the human desire for, choice is infinite. From classic economic theories of free enterprise, to mundane marketing practices that provide customers with entire aisles devoted to potato chips or soft drinks, to highly consequential life decisions in which people contemplate multiple options for medical treatment or investment opportunities for retirement, this belief pervades our institutions, norms, and customs. In this era of abundant choice, there are several dilemmas that people face: How do you choose given the sheer number of domains in which you now have the ability to choose? And in any given domain, what are the ramifications of being confronted with more options than ever before? In this talk, I will describe decisions we need to make that vary in significance from jams at a supermarket to life-or-death situations, looking at how the exercise of choosing and the availability of numerous options affect decision quality and happiness with the decision outcome.

You can watch her presentation on the four (roughly 9-minute) videos below.

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For more information about the Project on Law and Mind Sciences, click here.  For a sample of related Situationist posts, see “Can’t Get No Satisfaction!: The Law Student’s Job Hunt – Part II,” “Dan Gilbert on the Situation of Our Decisions,”and “Just Choose It!”  To review all of the Situationist posts that discuss the problem with, or illusion of, choices, click here.

Posted in Abstracts, Choice Myth, Positive Psychology, Social Psychology, Video | Tagged: , , | 4 Comments »

Free To Not Choose

Posted by The Situationist Staff on July 12, 2008

In February, John Tierney wrote a great column in February for the New York Times about Dan Ariely’s new book, Predictably Irrational. We already posted about Ariely’s book last week (see here). In this post, we simply wanted to highlight Tierney’s excellent summary of some of Ariely’s experiments.

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In a series of experiments, hundreds of students could not bear to let their options vanish . . . .

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They played a computer game that paid real cash to look for money behind three doors on the screen. . . . After they opened a door by clicking on it, each subsequent click earned a little money, with the sum varying each time.

As each player went through the 100 allotted clicks, he could switch rooms to search for higher payoffs, but each switch used up a click to open the new door. The best strategy was to quickly check out the three rooms and settle in the one with the highest rewards.

Even after students got the hang of the game by practicing it, they were flummoxed when a new visual feature was introduced. If they stayed out of any room, its door would start shrinking and eventually disappear.

They should have ignored those disappearing doors, but the students couldn’t. They wasted so many clicks rushing back to reopen doors that their earnings dropped 15 percent. Even when the penalties for switching grew stiffer — besides losing a click, the players had to pay a cash fee — the students kept losing money by frantically keeping all their doors open.

Why were they so attached to those doors? The players . . . say they were just trying to keep future options open. But that’s not the real reason, according to Dr. Ariely and his collaborator in the experiments, Jiwoong Shin, an economist who is now at Yale.

They plumbed the players’ motivations by introducing yet another twist. This time, even if a door vanished from the screen, players could make it reappear whenever they wanted. But even when they knew it would not cost anything to make the door reappear, they still kept frantically trying to prevent doors from vanishing.

Apparently they did not care so much about maintaining flexibility in the future. What really motivated them was the desire to avoid the immediate pain of watching a door close.

“Closing a door on an option is experienced as a loss, and people are willing to pay a price to avoid the emotion of loss,” Dr. Ariely says.

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To read the entire column, which is terrific, click here To play the three-door game, click here. For related Situationist posts, see “The Situation of Regret,” Why You Bought That,” “Just Choose It,” and “Can’t Get No Satisfaction” (Part 2).

Finally, below you can find a fifty-minute video of Ariely discussing and answering questions about his book.

Posted in Behavioral Economics, Book, Choice Myth, Life, Video | Tagged: , , , , , | 3 Comments »

 
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