Igniting Deliberation in High Stake Decisions: A Field Study

University of Zurich, Department of Economics, Working Paper No. 378

50 Pages Posted: 22 Mar 2021

See all articles by Andreas Hefti

Andreas Hefti

University of Zurich - Department of Economics; Zurich University of Applied Sciences

Peiyao Shen

University of Queensland - School of Economics

King King Li

Shenzhen Audencia Financial Technology Institute; Shenzhen University WeBank Institute of Fintech

Date Written: March 2021

Abstract

We conduct a large scale randomized field experiment to study whether providing recipients – 42,454 Chinese households in a rural area – with information on the costs of a real decision they make can help to improve the quality of their choices. The decisions are of high financial impact, as the objects of deliberation – air conditioners – have upfront prices exceeding the average monthly salary of a household. Besides providing nominal cost information, we conduct two additional treatments, where we either present the same information by making the real opportunity costs salient, or by administering the information via a quiz. The former aims at facilitating the comparison of effective costs, while the latter aims at enhancing attention and cognitive involvement. We find that providing cost information substantially affects the choices made, and reduces the decision mistakes, in particular in the two additional treatments.

Keywords: Information provision, opportunity costs, decision mistakes, involvement, energy efficiency

JEL Classification: D12, D83, L68, Q41, Q48

Suggested Citation

Hefti, Andreas M. and Shen, Peiyao and Li, King King, Igniting Deliberation in High Stake Decisions: A Field Study (March 2021). University of Zurich, Department of Economics, Working Paper No. 378, Available at SSRN: https://ssrn.com/abstract=3797548 or http://dx.doi.org/10.2139/ssrn.3797548

Andreas M. Hefti (Contact Author)

University of Zurich - Department of Economics ( email )

Zürich
Switzerland

Zurich University of Applied Sciences ( email )

Institut fuer Angewandte Medienwissenschaft
Zur Kesselschmiede 35
Winterthur, CH 8401
Switzerland

Peiyao Shen

University of Queensland - School of Economics ( email )

Brisbane, QLD 4072
Australia

King King Li

Shenzhen Audencia Financial Technology Institute ( email )

Shenzhen University WeBank Institute of Fintech

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