Tag Archives: Behavioral economics

Choice Architecture: Even in “Heads or Tails,” It Matters What’s Presented First

If you’re familiar with behavioural economics, then the results of this study will be right up your alley.

The researchers set out to determine whether there was a “first-toss Heads bias.” Meaning, when flipping a coin and the choices are presented “Heads or Tails,” there would be a bias towards people guessing “Heads” (because it was presented first). Through running their tests, they found something else that surprised them [Emphasis Added]:

Because of stable linguistic conventions, we expected Heads to be a more popular first toss than Tails regardless of superficial task particulars, which are transient and probably not even long retained. We were wrong: Those very particulars carried the day. Once the response format or verbal instructions put Tails before Heads, a first-toss Tails bias ensued.

Even in something as simple as flipping a coin, something where the script “Heads or Tails” is firmly engrained in our heads, researchers discovered that by simply switching the order of the choices, the frequency with which people chose one option or the other changed. That’s rather incredible and possibly has implications from policy to polling. However:

There is, of course, no reason to expect that, in normal binary choices, biases would be as large as those we found. In choosing whether to start a sequence of coin tosses with Heads or Tails, people ostensibly attach no importance to the choice and therefore supposedly do not monitor or control it. Since System 1 mental processes (that are intuitive and automatic) bring Heads to mind before Tails, and since there is no reason for System 2 processes (which are deliberative and thoughtful; see, e.g., Kahneman & Frederick, 2002) to interfere with whatever first comes to mind, many respondents start their mental sequence with Heads. However, in real-life questions people often have preferences, even strong ones, for one answer over another; the stronger the preference, the weaker the bias. A direct generalization from Miller and Krosnick (1998) suggests that in choices such as making a first-toss prediction, where there would seem to be no good intrinsic reason to guide the choice, order biases are likely to be more marked than in voting. At the magnitude of bias we found, marked indeed it was. Miller and Krosnick noted with respect to their much smaller bias that “the magnitude of name-order effects observed here suggests that they have probably done little to undermine the democratic process in contemporary America” (pp. 291–292). However, in some contexts, even small biases can sometimes matter, and in less important contexts, sheer bias magnitude may endow it with importance.

OK, so maybe these results don’t add too much to “government nudges,” but it can — at a minimum — give you a slight advantage (over the long haul) when deciding things by flipping coins with your friends. How?

Well, assuming that you are the one doing the flipping, you can say to your friend: “Tails or Heads?” (or “Heads or Tails?”) and then be sure to start the coin with the opposite side of what your friend said, facing up. A few years ago, Stanford math professor Persi Diaconis showed that the side facing up before being flipped is slightly more likely to be the side that lands facing up.

ResearchBlogging.orgBar-Hillel M, Peer E, & Acquisti A (2014). “Heads or tails?”–a reachability bias in binary choice. Journal of experimental psychology. Learning, memory, and cognition, 40 (6), 1656-63 PMID: 24773285

New Perspective on Healthiness: When You Get Unhealthy, Your Spouse or Your Kids Pay For It

I’m certainly a fan of behavioral economics, behavioral finance, and especially the ideas in Richard Thaler‘s book, Nudge. After reading Daniel Pink’s To Sell Is Human earlier this winter, I was thinking about how to combine some of the principles of those books in tackling what is a self-inflicted crisis: obesity.

Last month, I wrote about the importance of considering neuromarketing in the discussion of obesity, but I think there’s another way to frame this discussion. More importantly, at first blush, when framing it this way, I think it could motivate some people to take better care of themselves (at a minimum, it helped to motivate me to do so). I don’t remember how I came to this idea, but I know that it combines some of the things that I’ve read in the books I mentioned above (and was why I made note of them).

The idea: a marketing campaign in which we tell people that, when they get unhealthy, their spouse or their kids will have to pay for it.

Most people don’t want to burden their spouses (or their children), so I thought that by drawing to their attention that their spouse/kids will be the ones who’ll have to take care of them (and maybe pay for the cost of their care?), it might sway people away from making those choices that negatively affect their health.

When I had a conversation with someone about this, they raised the important point that many people don’t have spouses and many people don’t have kids, so this campaign might not be as successful as I first thought. Those are very valid points, but don’t we think that many people will — eventually — have spouses? If we can agree to that we then could add “future” spouse or “future” children to the campaign. I’d be interested to hear your thoughts on the underlying principle of the idea. Do you think that people care that their spouses/kids will be left to take care of them?