People routinely make decisions based on predictions made by others (e.g., political pundits, market analysts), so it is in their best interest to identify high-quality forecasts. Experts characterize good forecasting as minimization of continuous error (i.e., predictions close to the eventual outcome). By contrast, the present work reveals that laypeople typically see good forecasts as those that correctly predict an event’s categorical outcome (e.g., the winning team). Using within-subjects, between-subjects, and incentive-compatible designs, fifteen studies demonstrate this “pick-the-winner-picker heuristic” as well as its psychological mechanism: People evaluate forecasts by assigning separate weights to (a) categorical correctness and (b) continuous error minimization, depending on the overall importance of the categorical and continuous dimensions for that situation. Thus, in the common case when the categorical dimension matters most (e.g., sports contests), people prize forecasts that accurately predicted the categorical outcome (e.g., the winner, not the margin of victory). However, when the categorical dimension’s stakes are experimentally reduced, an attenuation is observed. While this describes how people typically evaluate forecasts, crucially, a dimension’s importance is not necessarily related to its diagnosticity of forecaster skill or reliability. Accordingly, the pick-the-winner-picker heuristic may constitute a normative mistake, while framing manipulations help debias judgments.
People making decisions often rely heavily on the opinions of similar—rather than dissimilar—others, a tendency most often explained by structural, social, or affective factors. We provide evidence that this behavior is also driven by a lack of appreciation that disagreeing views can be informative. Across six studies, we show that people disproportionately seek advice from sources that agree with them, even when a disagreeing advisor provides objectively more information about what to do. We replicate this undervaluation of systematic disagreement across a variety of tasks: for choices and ratings of advisors, in joint and separate evaluations, with naturalistic and controlled stimuli, and with and without monetary incentives. We show that this tendency persists in the absence of interpersonal interactions, which indicates that it operates independently of the social and emotional factors highlighted in past research. We also find that the effect can be moderated through deliberation and framing, which suggests that it reflects an intuitive neglect of disagreeing sources.
Accurately learning relationships between variables (e.g., ad spend and sales) is critical to sound managerial decision making. We offer evidence that people use a “category matching” heuristic to learn how well one variable (a cue) predicts another (an outcome). We show that people do not form judgments about the strength of the cue-outcome relationship (e.g., correlation between ad spend and sales) by accounting for the full breadth of the underlying continuous information. Rather, they heuristically consider the frequency with which a categorical encoding of the cue and the outcome match (e.g., how often does "high" versus "low" ad spend result in reaching versus not reaching a sales target). We present an analytical model of how categorical encoding disrupts cue-outcome learning and test its predictions across five preregistered experiments. We find that the frequency with which cue and outcome categories match affects learning outcomes. With the true cue-outcome correlation held constant, seeing fewer (vs. more) cue-outcome category matches caused participants to (a) evaluate the cue as less predictive of the outcome, (b) make less accurate out-of-sample predictions of the outcome, (c) become less confident in these predictions, and (d) evaluate spurious cues as more valid. We estimate the size of learning loss involved and show that reframing how information is presented can shrink the learning loss. Our findings suggest that reliance on cue-outcome category (mis)match can help explain why learning suffers in noisier environments.
It is well documented that parting with money can lead consumers to feel stressed, frustrated, or overburdened, in other words, consumers can feel a psychological pain of paying. We propose that, in addition to experiencing negative feelings from paying, consumers may also experience positive feelings from paying, such as satisfaction, pride, or even joy. For example, consumers may feel good when paying for a first home, picking up the tab for a celebratory meal, or paying off a debt. In contrast with a traditional view that models these positive feelings as low values on a single, bipolar "pain of paying" scale, we instead propose that the "pleasure of paying" is conceptually and psychologically orthogonal to the pain of paying. To illustrate the independence of these two dimensions, we experimentally demonstrate a fourfold pattern: both high and low pleasure of paying can coexist with both high and low pain of paying. The findings suggest that in order to accurately capture consumers’ feelings—and thus their downstream behaviors—researchers ought to consider measuring the pleasure of paying separately alongside pain of paying.
One challenge of gift giving is that givers must forecast a recipient's reaction. When forecasting such reactions, gift givers may rely on various cues, including product attributes, recipient preferences, and previous gifting experiences. We propose that, in addition to inferring recipient preferences from product attributes, givers may rely on the feelings they experience when gift shopping. Across six preregistered studies, we find that gift givers expect recipients to like gifts more when givers have more (versus less) positive purchase experiences, such as a positive interaction with a store employee. Drawing on affective forecasting and social projection research, we argue that gift givers rely on their own positive feelings of the gift to infer what recipients might feel about it. This effect appears across products, price levels, and shopping experience contexts. Findings document the role of gift-givers’ shopping experiences in gift-giving decisions and highlight the influence of social projection on givers' inferences of recipient liking.
Consumers typically adapt to products, getting less utility from them over time. We examine whether and how consumers intentionally alter their consumption patterns to prevent adaptation from occurring. Specifically, we find across five preregistered studies that when consumers aim to prevent adaptation to a stimulus, they adopt strategies such as (i) planning to reduce total consumption frequency, (ii) reducing repeat consumption, (iii) avoiding less-than-ideal consumption opportunities, and (iv) reducing the likelihood that consumption opportunities will arise. The findings suggest one reason consumers sometimes forgo favored products: strategically seeking to preserve liking for them.