Abstract

http://ssrn.com/abstract=1938787
 
 

References (6)



 


 



Global versus Local Choice Representations and the Preference for Certainty


Kristen Duke


University of California, San Diego (UCSD) - Rady School of Management

Kelly Goldsmith


Northwestern University - Kellogg School of Management

On Amir


University of California, San Diego (UCSD) - Rady School of Management

August 13, 2016


Abstract:     
A great deal of academic research across a variety of disciplines has demonstrated that consumers generally show a preference for certainty in the domain of gains. In the current research, we provide evidence for an important, and previously unconsidered, psychological antecedent to this effect. Specifically, we find that the likelihood of choosing a certain reward (e.g., $100) over an uncertain reward with a greater expected value (e.g., an option offering an 89% chance of receiving $100, a 10% chance of receiving $500, and a 1% chance of receiving $0) is affected by how those choices are cognitively represented. Across five experiments, we find that forming a global (vs. local) representation of the choice options accentuates (vs. attenuates) the preference for certainty. We test for this result using manipulations of mental representation that vary organically in the marketplace, such as features inherent to the choice outcomes (e.g., the monetary value of the potential gains), exogenous influences (e.g., time pressure), and individual differences (e.g., cognitive reflection). In doing so, our findings offer novel insights into when consumers are more (vs. less) likely to show a preference for certainty in common, retail settings.

Number of Pages in PDF File: 67

Keywords: uncertainty, risk, global processing, mental representation


Open PDF in Browser Download This Paper

Date posted: October 5, 2011 ; Last revised: August 13, 2016

Suggested Citation

Duke, Kristen and Goldsmith, Kelly and Amir, On, Global versus Local Choice Representations and the Preference for Certainty (August 13, 2016). Available at SSRN: http://ssrn.com/abstract=1938787 or http://dx.doi.org/10.2139/ssrn.1938787

Contact Information

Kristen E. Duke
University of California, San Diego (UCSD) - Rady School of Management ( email )
9500 Gilman Drive
Rady School of Management
La Jolla, CA 92093
United States
Kelly Goldsmith (Contact Author)
Northwestern University - Kellogg School of Management ( email )
2001 Sheridan Road
Evanston, IL 60208
United States
HOME PAGE: http://www.kellogg.northwestern.edu/faculty/goldsmith/htm/
On Amir
University of California, San Diego (UCSD) - Rady School of Management ( email )
9500 Gilman Drive
Rady School of Management
La Jolla, CA 92093
United States
858-534-2023 (Phone)
858-534-0745 (Fax)
HOME PAGE: http://management.ucsd.edu/faculty/directory/amir/
Feedback to SSRN


Paper statistics
Abstract Views: 367
Downloads: 81
Download Rank: 185,567
References:  6

© 2016 Social Science Electronic Publishing, Inc. All Rights Reserved.  FAQ   Terms of Use   Privacy Policy   Copyright   Contact Us
This page was processed by apollobot1 in 0.219 seconds