Less Is Better: When Low-value Options Are Valued More Highly than High-value Options

Journal of Behavioral Decision Making, Vol. 11, 1998

15 Pages Posted: 11 Oct 2006  

Christopher K. Hsee

University of Chicago - Booth School of Business

Abstract

This research demonstrates a less-is-better effect in three contexts: (1) a person giving a $45 scarf as a gift was perceived to be more generous than one giving a $55 coat; (2) an overfilled ice cream serving with 7 oz of ice cream was valued more than an underfilled serving with 8 oz of ice cream; (3) a dinnerware set with 24 intact pieces was judged more favourably than one with 31 intact pieces (including the same 24) plus a few broken ones. This less-is-better effect occurred only when the options were evaluated separately, and reversed itself when the options were juxtaposed. These results are explained in terms of the evaluability hypothesis, which states that separate evaluations of objects are often influenced by attributes which are easy to evaluate rather than by those which are important.

Keywords: evaluability, joint evaluation, separate evaluation, preference reversal, dominance violation

JEL Classification: D81, D11, D12, D91

Suggested Citation

Hsee, Christopher K., Less Is Better: When Low-value Options Are Valued More Highly than High-value Options. Journal of Behavioral Decision Making, Vol. 11, 1998. Available at SSRN: https://ssrn.com/abstract=930083

Christopher K. Hsee (Contact Author)

University of Chicago - Booth School of Business ( email )

5807 S. Woodlawn Avenue
Chicago, IL 60637
United States

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