Funded Research

Morrison Center Working Paper Series

 

Reminding People of the Ephemerality of Behaviors Increases Goal Completion

Morrison Center Working Paper No. 23-001

Alicea Lieberman, Assistant Professor of Marketing
Hal Hershfield, Professor of Marketing and Behavioral Decision Making, Marketing Area Chair, UCLA Anderson
There are many important behaviors in life that people find challenging but would like to do more of—these could include health behaviors such as exercising or interpersonal behaviors such as being more present with one’s children. In this research, we examine ways to increase motivation and completion of such goals. Specifically, we examine whether reminding people of the ephemerality of an experience increases goal completion. Across a number of contexts—including exercise, relationships, and parenting—we find that prompting people to consider how one day in the future they will no longer be able to do something the way they can today increases their motivation to do that behavior.
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Fake Reviews and Consumer Welfare

Morrison Center Working Paper No. 23-002

Ashvin Gandhi, Assistant Professor, UCLA Anderson
Brett Hollenbeck, Associate Professor of Marketing, UCLA Anderson
This paper investigates the impact on consumers of the widespread manipulation of rep-
utation systems by sellers on two-sided online platforms. We focus on a relevant empirical
setting, the use of fake product reviews on e-commerce platforms, which can affect consumer
welfare via two channels. First, rating manipulation deceives consumers directly, causing
them to buy lower quality products and pay higher prices for the products with manipulated
ratings. Second, the presence of rating manipulation lowers trust in ratings, which may
result in worse product matches if consumers place too little weight on quality ratings. This
decrease in trust may also increase price competition and benefit consumers by lowering
prices on high quality products whose quality is less easily observed. We formally model
how consumers form beliefs about quality from product ratings and how these beliefs are
affected by the presence of fake reviews. This model of product quality is incorporated into
an empirical model of consumer demand for products and how demand is shifted by ratings,
reviews, and prices. The model is estimated using a large and novel dataset of products
observed buying fake reviews to manipulate their Amazon ratings. We use counterfactual
policy simulations in which fake reviews are removed and consumer beliefs adjust accord-
ingly to explore the effectiveness and welfare and profit implications of different methods of
regulating fake reviews.
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The Impact of Legalized Sports Gambling on Consumer Debt

Morrison Center Working Paper No. 23-003

Brett Hollenbeck, Associate Professor of Marketing, UCLA Anderson
David Proserpio, Assistant Professor of Marketing at the University of Southern California Marshall School of Business
Beginning in 2018, more than 30 U.S. states have passed some form of legalized sports gambling. We use the state-by-state rollout of legal sports gambling to study how this policy has impacted consumer finances and the share of the population experiencing financial stress in the impacted states. We use detailed data on consumer credit outcomes for a large national sample. We also study how and whether different demographic groups are affected by sports gambling legalization. We also collect data on advertising by the major sports gambling firms in order to understand how advertising strategy affects consumer credit outcomes and firm market shares.
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Budgeting Increases Reliance on Category-Level Evaluations

Morrison Center Working Paper No. 23-004

David Dolifka, Marketing Ph.D. Student, UCLA Anderson
Stephen Spiller, Associate Professor of Marketing and Behavioral Decision Making, Associate Dean of Anderson Ph.D. Program, UCLA Anderson

Consumers frequently use budgets to manage their spending. Budgets are consequential, as money in budgets is treated as though it is not fungible, so budget allocations matter. How do consumers set budget allocations? Consumers could use item-level evaluations, and set budgets in accordance with their end purchases, or category-level evaluations, and set budgets in accordance with their overall evaluations of the category. We propose that relative to purchase decisions, allocation decisions increase consumers’ reliance on category-level evaluations. As a result, budget allocations are more sensitive to category summary representations (i.e., the average value of a category) than are purchase decisions. Because budget allocations causally impact spending, the act of budgeting shifts spending toward categories with higher average value. This implies consumers with identical preferences and identical budget levels will spend differently, depending on whether they allocate in advance of spending. We present evidence of these patterns in three preregistered experiments including a mouse-tracking study and an incentivized, data-rich experimental game.

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Protect the Innocent or Punish the Guilty? Explaining Seemingly Inconsistent Beliefs About Which Types of Errors to Prevent Versus Fix in Punishment and Reward Systems

Morrison Center Working Paper No. 23-005

Eitan Rude, Marketing Ph.D. Student, UCLA Anderson
Franklin Shaddy, Assistant Professor of Marketing and Behavioral Decision Making, UCLA Anderson

Countless policies are crafted with the intention of punishing all who do wrong or rewarding only those who do right. However, this requires accommodating certain mistakes: some who do not deserve to be punished might be, and some who deserve to be rewarded might not be. Six preregistered experiments (N = 3,484 U.S. adults) reveal that people are more willing to accept this trade-off in principle, before errors occur, than in practice, after errors occur. The result is an asymmetry such that for punishments, people believe it is more important to prevent false negatives (e.g., criminals escaping justice) than to fix them, and more important to fix false positives (e.g., wrongful convictions) than to prevent them. For rewards, people believe it is more important to prevent false positives (e.g., welfare fraud) than to fix them, and more important to fix false negatives (e.g., improperly denied benefits) than to prevent them.

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The Role that Evidence Plays in Dishonest Reporting

Morrison Center Working Paper No. 23-006

Eugene Caruso, Professor of Management and Organizations and Behavioral
Sam Skowronek, Ph.D. in Operations, Information, and Decisions, The Wharton School

Evaluating Point and Range Predictions Under Epistemic vs. Aleatory Uncertainty

Morrison Center Working Paper No. 23-007

Hal Hershfield, Professor of Marketing and Behavioral Decision Making, Marketing Area Chair, UCLA Anderson
Craig Fox, Harold Williams Chair and Professor of Management, Area Chair
Eitan Rude, Marketing Ph.D. Student, UCLA Anderson

Experts can express predictions as points (e.g., ‘Sea levels will rise by 4 in.’), or as ranges of various widths (e.g., ‘Sea levels will rise by 2-6 in.’). In four studies we show that listeners’ evaluations of such formats depend on their match with the perceived nature of uncertainty. Under epistemic (knowable) uncertainty, experts are rewarded for point estimates and penalized for successively wider ranges. In contrast, under aleatory (random) uncertainty, experts are rewarded for range estimates but punished for point estimates and ranges that are too narrow or wide. These results have implications for how we communicate uncertainty and interpret confidence intervals.

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Using data analytics to identify gender differences in postnatal labor market attachment

Morrison Center Working Paper No. 23-008

Jana Gallus, Associate Professor of Strategy and Behavioral Decision Making, UCLA Anderson School of Management
Jennifer Kao, Assistant Professor of Strategy
The official health guideline in many Western countries is that infants be exclusively breastfed for the first 6 months, after which solid foods can be introduced. In 2022, the American Academy of Pediatrics recommended continued breastfeeding for 2 years or longer. Breastfeeding is a task that is rarely outsourced in the US and other industrialized countries. It thus tends to one-sidedly fall on birthing parents (“mothers”). It moreover tends to happen behind closed doors, making it difficult to measure the cost of the time that women spend on this task. Such measures of time costs are important for understanding the “motherhood penalty” in labor markets and for designing equitable organizational and public policies. This study is the first large-scale effort to metricize the time required to feed a baby with breastmilk (nursing, breast-pumping, bottle-feeding). We will recruit parents to a panel survey and link that data to their tracked feeding times. This will allow us to estimate the time spent, quantify its value, shed light on important labor market and wellbeing outcomes, and to investigate effective organizational and family level interventions.
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Female Medical Students are Less Likely to Submit a Truthful Rank Ordering of Preferences in the National Residency Match Program

Morrison Center Working Paper No. 23-009

Joyce He, Assistant Professor of Management and Organizations
Sam Skowronek, Ph.D. in Operations, Information, and Decisions, The Wharton School

The Politics of Minority Portrayal

Morrison Center Working Paper No. 23-010

Margaret Shih, Department Chair and Deputy Dean of Academic Affairs, Neil Jacoby Chair in Management; Professor of Management and Organizations, UCLA Anderson School of Management
Elizabeth Jiang, M & O Ph.D. Student, UCLA Anderson School of Management
Our research seeks to understand how the two trends of a growing ideological divide and heightened awareness of social justice-related issues in the U.S. interact to affect perceptions of minority portrayal. We assert that the current U.S. political climate is so polarized that the evaluation of minority portrayals will vary based on a viewer’s political ideology. As such, we predict that perceptions of such depictions will differ between ideologically liberal and conservative individuals. Furthermore, we theorize that a main property of this political polarization is the especially strong anti-progressiveness sentiment from conservative-minded individuals. To advance our program of study, we also propose competing interventions to explore what might alter the predicted anti-progressive bias from conservative participants.
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“No Time to Buy”: Asking Consumers to Spend Time to Save Money is Perceived as Fairer than Asking Consumers to Spend Money to Save Time

Morrison Center Working Paper No. 23-011

Maria Trupia, Postdoctoral Scholar, UCLA Anderson
Franklin Shaddy, Assistant Professor of Marketing and Behavioral Decision Making, UCLA Anderson

Committing to Outcomes vs. Actions

Morrison Center Working Paper No. 23-012

Megan Weber, Behavioral Decision Making Ph.D. Student, UCLA Anderson
Alicea Lieberman, Assistant Professor of Marketing
Commitment devices - arrangements in which people alter their future choice sets to encourage a specific behavior - are one effective way to help people resist the temptation to stray from their goals. However, commitments can vary in structure: some add incentives that are contingent on reaching (or failing to reach) the overarching goal, while others add incentives that are contingent on taking (or not taking) specific actions towards that goal. The existing literature has not distinguished between commitments focused on outcomes vs. actions. In this research, we explore differences in perceptions, take-up, and effectiveness of these different types of commitments.
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Citizen Myopia

Morrison Center Working Paper No. 23-013

Megan Weber, Behavioral Decision Making Ph.D. Student, UCLA Anderson
Craig Fox, Harold Williams Chair and Professor of Management, Area Chair
Citizens are frequently asked to weigh in on government spending initiatives by voting on ballot initiatives or responding to polls that are used to inform policy makers. However, the average citizen does not necessarily have an in-depth understanding of government spending - including the scope, constraints, and alternatives - leaving them unequipped to rationally evaluate proposals presented in isolation. In this research, we plan to explore how this citizen myopia impacts responses to policy proposals. Specifically, we will investigate how unfamiliarity with government spending and difficulty interpreting such large numbers means that people are not taking policy priorities and costs into account when expressing opinions. In addition, we will also test the impact of context and salient alternatives on support for focal policies, shedding light on citizens' preference construction process.
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Stocks, Flows, and the Social Security Trust Funds

Morrison Center Working Paper No. 23-014

Megan Weber, Behavioral Decision Making Ph.D. Student, UCLA Anderson
Stephen Spiller, Associate Professor of Marketing and Behavioral Decision Making, Associate Dean of Anderson Ph.D. Program, UCLA Anderson
Hal Hershfield, Professor of Marketing and Behavioral Decision Making, Marketing Area Chair, UCLA Anderson
Suzanne Shu, Professor Emeritus, UCLA Anderson
The Social Security trust funds were created to hold and invest surplus tax revenue not used to pay out benefits, but because yearly benefits obligations have begun exceeding tax receipts, Social Security has started to draw down on the trust fund reserves. This research uses the theoretical lens of stock-flow reasoning to understand how consumers think about the future of Social Security and what will happen to benefits if the trust funds become completely depleted. Initial experiments suggest that communications emphasizing the continuity of inflows (i.e., payroll taxes paid into the system by workers) help decrease the misconception that benefits will go away after the trust fund balance runs to zero. Ongoing work seeks to understand consumers’ mental models of how the Social Security system works and how interventions that target specific aspects of the system impact understanding.
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New Money or More of the Same? Tracking the Meaning of Financial Growth

Morrison Center Working Paper No. 23-015

Qingyang Wang, Ph.D Marketing Student, UCLA Anderson
David Dolifka, Marketing Ph.D. Student, UCLA Anderson
Stephen Spiller, Associate Professor of Marketing and Behavioral Decision Making, Associate Dean of Anderson Ph.D. Program, UCLA Anderson

Bidding by heterogeneously risk-averse bidders in first-price auctions with reserves

Morrison Center Working Paper No. 23-016

Robert Zeithammer, Professor of Marketing, UCLA Anderson
Lucas Stich, Assistant Professor, Wurzburg University

Double marginalization in digital advertising markets run by auctions

Morrison Center Working Paper No. 23-017

Robert Zeithammer, Professor of Marketing, UCLA Anderson
W. Jason Choi, Assistant Professor, Robert H. Smith School of Business, University of Maryland

Brand Imagery and Ethnic Cue (Mis)Matches

Morrison Center Working Paper No. 23-018

Sanjay Sood, Professor of Marketing and Behavioral Decision Making, UCLA Anderson
Neha Nair, Marketing Ph.D. Student, UCLA Anderson
Karl Aquino, Richard Poon Professor of Organizations and Society at the UBC Sauder School of Business, Marketing and Behavioural Science Division

Our work examines the effect of mismatches between ethnic cues contained in advertisements and pre-existing consumer beliefs about brand users on ad evaluations. Brands are often looking to enter new market segments, especially that of minority groups whose growing purchasing power represents profitable opportunities. For such endeavors, extant research suggests that members of a given group will respond most favorably to advertising in which members of their group are represented. However, prior research has generally failed to consider the effects of pre-existing brand associations on consumers' responses to advertising. We propose that for brands with established brand user associations, consumers are likely to expect ads to employ imagery that is consistent with the associations. Consequently, the inclusion of members of stigmatized, minority groups in advertising for majority-associated brands and vice-versa has the potential to create mismatches between the user meanings depicted in advertisements and pre-existing brand associations resulting in negative consumer responses. In our experiments, we find asymmetric negative effects of mismatches involving dominant versus subordinate group ethnic cues and a moderating effect of individual differences in social dominance orientation. In ongoing work, we explore a possible way in which brands might be able mitigate these effects through use of sub-brands.

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Do Discount Rates Vary with Respect to Climate Outcomes

Morrison Center Working Paper No. 23-019

Shelli Orzach, Behavioral Decision Making, UCLA Anderson
Hal Hershfield, Professor of Marketing and Behavioral Decision Making, Marketing Area Chair, UCLA Anderson

Pluralistic Ignorance of Stigma Impedes Take-Up of Welfare Benefits

Morrison Center Working Paper No. 23-020

Sherry Wu, Assistant Professor of Management and Organizations
Alice Lee-Yon, PhD Candidate in Management and Organizations, UCLA Anderson
Eugene Caruso, Professor of Management and Organizations and Behavioral

Unraveling the Role of Market Concentration in the Price Puzzle

Morrison Center Working Paper No. 23-021

Shohini Kundu, Assistant Professor of Finance
Jinyuan Zhang, Assistant Professor of Finance, UCLA Anderson

Investigating The Role of Objectivity in Source Memory

Morrison Center Working Paper No. 23-022

Stephen Spiller, Associate Professor of Marketing and Behavioral Decision Making, Associate Dean of Anderson Ph.D. Program, UCLA Anderson
Daniel Mirny, Marketing Ph.D. Student, UCLA Anderson

Effective communication relies on consumers remembering, sharing, and applying relevant information. Source memory, the ability to link a claim to its original source, is an essential aspect of accurate recall, attitude formation, and decision making. We propose that claim objectivity, whether a claim is a fact or an opinion, affects memory for the claim’s source. This proposal follows a two-step process: (i) opinions provide more information about sources than facts do; (ii) claims that provide more information about sources during information encoding are more likely to be accurately attributed to original sources during recall. Across twelve pre-registered experiments (N=7,008) and a variety of consumer domains, we investigate the effect of claim objectivity on source memory. We find that source memory is more accurate for opinions than for facts, with no consistent effect on claim recognition memory. We find support for the proposed process by manipulating facts to be more informative about sources and opinions to be less informative about sources. When forming inferences and seeking advice from sources, participants integrate new evidence more accurately based on sources’ previously shared opinions than facts. Our results indicate that opinions are more likely to be accurately attributed to original sources than are facts.

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Antitrust in Advertising-Subsidized Markets: Youtube Content Economy

Morrison Center Working Paper No. 23-023

Tai Lam, Assistant Professor of Marketing

Understanding Time Poverty for Consumer Research

Morrison Center Working Paper No. 23-024

Cassie Mogilner, Professor of Marketing and Behavioral Decision Making, Bud Knapp Marketing Professorship
Maria Trupia, Postdoctoral Scholar, UCLA Anderson

Vividness of the future and demand for commitment

Morrison Center Working Paper No. 23-025

Hal Hershfield, Professor of Marketing and Behavioral Decision Making, Marketing Area Chair, UCLA Anderson
Megan Weber, Behavioral Decision Making Ph.D. Student, UCLA Anderson

Commitment devices have been established as effective tools for behavior change across many domains of goal pursuit, including health, wealth, and addiction. However, one key problem faced by choice architects seeking to implement commitments as a tool for behavior change is that in order for them to work, people have to sign up for them – and there is relatively little research on how to optimize this stage of the intervention. In this research, we plan to explore how vividness of the future relates to the demand for commitment and how manipulations that help people imagine the future in more detail influence commitment choices. 

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Asymmetric Reactions to Erroneous Punishments and Rewards

Morrison Center Working Paper No. 22-001

Eitan Rude, Marketing Ph.D. Student, UCLA Anderson
Franklin Shaddy, Assistant Professor of Marketing and Behavioral Decision Making, UCLA Anderson

Punishments and rewards are regularly used to discourage negative behaviors and encourage positive ones. But mistakes happen. Sometimes the deserving are not punished or rewarded when they should be (i.e., we realize false negatives), and other times, the undeserving are punished or rewarded when they should not be (i.e., we realize false positives). Which is worse, when, and why? In this ongoing work, we find that people care more about preventing false negatives than fixing them for punishments; for rewards, the opposite holds: people care more about preventing false positives than fixing them. These findings help explain seemingly inconsistent public reactions to various real-world policies in prospect versus retrospect (e.g., calls for “tough-on-crime” reforms ex ante vs. support for “innocence projects” ex post), and have important implications for policymakers, marketers, and managers involved in designing and maintaining incentive systems.

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The Intersection of Political Beliefs and Diversity Representation: Understanding Responses to Stereotype Content in Ads

Morrison Center Working Paper No. 22-002

Margaret Shih, Department Chair and Deputy Dean of Academic Affairs, Neil Jacoby Chair in Management; Professor of Management and Organizations, UCLA Anderson
Elizabeth Jiang, M & O Ph.D. Student, UCLA Anderson
Political polarization in the U.S. has continued to brew and underscore intergroup conflict in American society. Meanwhile, the U.S. is becoming increasingly diverse. As the American population diversifies, more polarized attention has been given to inequities in representation in popular media. Because of the growing animosity between political groups, there exists a strong phenomenon of backlash among conservative groups against more progressive representation. Our current research seeks to understand how these two trends of exceptional political divide and increasing diversity in the U.S. interact to affect marketing outcomes. Specifically, how might American adults respond to ads that feature models selling products or services that are “traditionally” associated with their identities versus ads that represent them with items that are the opposite to their “expected” identity? How might these responses stem from their identity traits, and what can be done to influence more open-minded perceptions?
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Framings of Uncertainty and Intentions to Take Protective Action

Morrison Center Working Paper No. 22-003

Eitan Rude, Marketing Ph.D. Student, UCLA Anderson
Hal Hershfield, Professor of Marketing and Behavioral Decision Making, Marketing Area Chair, UCLA Anderson

Experts regularly seek to persuade individuals to make sacrifices in the present that will help them prevent against negative events in the future. For example, investment professionals promote choices that will help prevent against insolvency in old age; firms and policymakers promote choices that will help prevent against the consequences of climate change; and so on. In these and other cases, experts might elect to make predictions that correspond to a single possible outcome (e.g., “your savings will run out at age 77”) or a range of possible outcomes (e.g., “your savings will run out between ages 74-77”). In the present research, we ask the following: does the framing of such predictions influence individuals’ propensity to take protective action, and if so, why?

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Investigating The Role of Binary versus Continuous Framing on Cheating and Punishment

Morrison Center Working Paper No. 22-004

Euguene Caruso, Professor of Management and Organizations and Behavioral Decision Making, Bing (’86) and Alice Liu Yang Endowed Term Chair in Teaching Excellence, Faculty Co-Director, Inclusive Ethics Initiative, UCLA Anderson
Daniel Mirny, Marketing Ph.D. Student, UCLA Anderson

Consumers frequently encounter situations where they can cheat, lie, or engage in otherwise morally dubious behaviors in order to advance their own self-interest. Moreover, consumers often see other individuals or firms engaging in such behaviors, and will choose when to punish them for these transgressions. Across a set of pre-registered experiments (N=2,042), we find that manipulating the way in which people perceive the world, as either a binary construct (black and white) or a continuous construct (shades of gray), affects punishment and cheating behaviors. Three additional sets of studies aim to extend on this important framing effect. One ongoing set of studies focuses on identifying additional behavioral outcomes. Another set of studies looks for individual differences - variance in lay beliefs about morality as either a binary or a continuous construct. A third set of studies investigates a potential mechanism, whether the use of a binary or continuous moral frame varies within-person across-contexts. In this research, we replicate and expand upon an important observed effect, aiming to further our understanding of the effect of framing morality (as either a binary or a continuous construct), on how people make decisions about their own behavior and how they evaluate others.

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Pharmaceutical Advertising to Consumers and Doctors

Morrison Center Working Paper No. 22-005

Sylvia Hristakeva, Assistant Professor, Cornell SC Johnson College of Business
Julie Holland Mortimer, Full Professor, Boston College

The Fox News Effect on Attitudes Towards The Scope of Policing

Morrison Center Working Paper No. 22-006

Kareem Haggag, Assistant Professor of Behavioral Economics, UCLA Anderson
Eric Chyn, Assistant Professor, Dartmouth College
Bocar Abdoulaye Ba, Assistant Professor, Duke University

Leveraging Past Adversity to Increase Academic Success

Morrison Center Working Paper No. 22-007

Hal Hershfield, Professor of Marketing and Behavioral Decision Making, Marketing Area Chair, UCLA Anderson
Ilana Brody, Behavioral Decision Making Ph.D. Student, UCLA Anderson

A Behavioral Study of Self-other Adoption Discrepancies in Explainable Artificial Intelligence (XAI)

Morrison Center Working Paper No. 22-008

Fernanda Bravo, Assistant Professor of Decisions, Operations and Technology Management
Zezhen (Dawn) He, PhD in Operations Management, Simon Business School
Yaron Shaposhnik, Assistant Professor of Information Systems and Operations Management at the Simon School of Business in the University of Rochester
León Valdés, Assistant Professor of Business Administration, University of Pittsburgh

Investigating The Role of Objectivity in Source Memory

Morrison Center Working Paper No. 22-009

Stephen Spiller, Associate Professor of Marketing and Behavioral Decision Making, Associate Dean of Anderson Ph.D. Program, UCLA Anderson
Daniel Mirny, Marketing Ph.D. Student, UCLA Anderson

Online Quality Scores, Competition and Welfare

Morrison Center Working Paper No. 22-010

Brett Hollenbeck, Associate Professor of Marketing, UCLA Anderson
Davide Proserpio, Assistant Professor of Marketing at the University of Southern California Marshall School of Business

Consumers Believe Legal Products Are Less Effective Than Illegal Products

Morrison Center Working Paper No. 22-011

Alicia Lieberman, Assistant Professor of Marketing, UCLA Anderson
Sydney Scott, Assistant Professor of Marketing, Olin Business School
Rachel Gershon, Assistant Professor of Marketing, Haas Business School, UC Berkeley

This research examines how consumers make judgments about a product’s effectiveness based on the product’s legality. Across eight pre-registered experiments, and a wide range of products, we find that consumers believe legal products are less effective than illegal products. Even when viewing identical, objective product outcomes (e.g., before and after pictures of a teeth whitening treatment), consumers perceive reduced product benefits from a product described as legal (vs. illegal). We find that consumers assume that the government is less interested in regulating and controlling legal products, and consumers therefore infer that legal products are weaker (i.e., lower strength) than illegal products. This weakness inference leads consumers to believe legal products have smaller consequences – both smaller positive consequences (lower efficacy) and smaller negative consequences (lower harm). We provide support for our theory by demonstrating that the effect of legality on perceived efficacy is eliminated if legal and illegal products are specified to be equally regulated or to be of equal product strength. We further demonstrate that these beliefs directly influence consumer choice. Given the significant health and economic consequences of illegal product consumption, this research has important implications for consumers, marketers, public health professionals, and policy makers.

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Doing Good by Doing Business: Brand Purpose and Its Impact on Consumers

Morrison Center Working Paper No. 22-012

Sanjay Sood, Professor of Marketing and Behavioral Decision Making
Neha Nair, Marketing Ph.D. Student, UCLA Anderson

Over the last few years, a brand’s “purpose" - its long-term central aim of productive engagement with the world, beyond profits - has become increasingly important for consumers and brands alike. FMCG giants such as P&G and Unilever, for instance, have spoken at length about being “a force for good and a force for growth” as products such as soaps, detergents, and even mayonnaise (#MakeTasteNotWaste) are repositioned to have a purpose. Consumers too are increasingly seeking out brands that are committed to contributing positively to society with events such as the global pandemic intensifying these expectations. Going forward, brands may not only be expected to define and communicate their purpose but might also be punished by consumers for not doing so. In this project, we aim to provide a more in-depth understanding of brand purpose by situating it within existing literature and systematically investigating consumer responses to the same. We introduce a typology to integrate brand purpose with different concepts from the CSR and business strategy domains as well as empirically investigate consumer responses to brand purpose. Our initial studies suggest that brand purpose may not only benefit the brand through positive attitudes and perceived credibility (vs. CSR) but also contribute to consumer well-being by eliciting strong feelings of moral elevation.

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Human vs Robots: Tipping for Services

Morrison Center Working Paper No. 22-013

Franklin Shaddy, Assistant Professor of Marketing and Behavioral Decision Making, UCLA Anderson
Neha Nair, Marketing Ph.D. Student, UCLA Anderson
David Dolifka, Marketing Ph.D. Student, UCLA Anderson

Recent years have seen a dramatic shift in both the way consumers receive services and the way they pay for them. One major evolution is the use of robots in service industries, with many firms using robots to make deliveries, conduct food prep, or serve customers. A parallel evolution in the consumer space is the widespread adoption of technologically assisted tipping. With the increasing shift to cashless payments over the last few years, tipping opportunities have become both easier to comply with and more widespread. While technology may have enabled more explicit opportunities to leave a tip, consumers may still be discriminating in how they allocate tips. An open and timely question then is how consumers will respond to these frequent tip requests for services that are provided by robots. In this project, we aim to consider consumer tipping preferences for equivalent services rendered exclusively by either humans or robots as well as cases in which a hybrid of human and robot actions contribute towards a given service. We propose the observability of human effort as an important predictor of tipping behavior, which has implications for how managers allocate human effort in robot-assisted environments.

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Present Benefit Precommitments to Encourage Prosocial Action

Morrison Center Working Paper No. 22-014

Craig Fox, Harold Williams Chair and Professor of Management, Area Chair
Megan Weber, Behavioral Decision Making Ph.D. Student, UCLA Anderson

One well-known method to help people follow through on their intentions to do the things they want to do (e.g., lose weight or quit smoking) is precommitment (e.g., sign a contract to pay a fine if one fails to act accordingly). The demand for such arrangements is considered a tell-tale sign that people know they suffer from self-control problems. However, classic precommitments require the actor to forecast trouble following through, meaning that only those who anticipate needing to constrain their future choices (by imposing future costs on themselves for giving into temptation) will sign up for such an arrangement. In this research, we will explore whether we can increase the take-up - and thus overall impact - of precommitment devices in the realm of prosocial behavior by including "present benefits" (i.e., lottery incentives to sign up). We expect this method to be especially useful in situations where people underestimate future obstacles to their follow-through (e.g., when promising to vote, donate blood, or volunteer time to a charity), and that in such contexts follow-through can be reinforced by threatening to take away benefits or by applying social pressure to make good on prior commitments.

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Investment Decision Making and Fear of Missing Out

Morrison Center Working Paper No. 22-015

Hal Hershfield, Professor of Marketing and Behavioral Decision Making, Marketing Area Chair, UCLA Anderson
Megan Weber, Behavioral Decision Making Ph.D. Student, UCLA Anderson
The rise of retail trading websites and mobile apps means that anyone with internet access or a smartphone can make almost instantaneous investment decisions. The recent sharp spikes and quick declines of stocks such as Bed, Bath & Beyond or GameStop have highlighted the role that social media can play in driving market dynamics, where online communities seem to be influencing individual investor decision making and leading to large gains for some - but losses for many others. Although there is a large body of research explaining aggregate-level market trends using seemingly extraneous variables (e.g., the weather), there is much less work examining the emotional experiences of individual investors deciding to sell an investment during a crash, jump in on the latest meme stock, or buy cryptocurrency when their social media feeds are full of posts about it. This research focuses on the psychology behind decisions to invest in these now commonplace situations: volatile, short-term investment opportunities where investors have access to information about the decisions (and gains or losses) of others. Specifically, we plan to explore how the experience of “fear of missing out” (FOMO) can help explain investor decision making in these contexts and develop interventions that can be used to help investors make more informed decisions.
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From Warm Glow to Cold Chill: Choice Avoidance in Charitable Donations

Morrison Center Working Paper No. 22-016

Ilana Brody, Behavioral Decision Making Ph.D. Student, UCLA Anderson
Hengchen Dai, Associate Professor of Management and Organizations and Behavioral Decision Making, UCLA Anderson
Jana Gallus, Associate Professor of Strategy and Behavioral Decision Making, UCLA Anderson

As charitable organizations increasingly introduce choice into donation opportunities, they may be overlooking a critical psychological construct inherent in framing a choice between multiple deserving populations. We propose that a donation choice framed as a choice between “who to help” elicits concerns about fairness and decision burdens, which ultimately reduces donations relative to the same donation opportunity framed as a choice between “what to give”. This research will advance our understanding of the impact of choice and framing on judgment and decision making in the consequential context of charitable giving. The research will also offer solutions to help charities increase donations.

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When Impact Appeals Backfire: Evidence from a Multinational Field Experiment and the Lab

Morrison Center Working Paper No. 22-017

Hengchen Dai, Associate Professor of Management and Organizations and Behavioral Decision Making, UCLA Anderson
Jana Gallus, Associate Professor of Strategy and Behavioral Decision Making, UCLA Anderson School of Management
Joseph Reiff, Assistant Professor of Marketing, University of Maryland
Firms often try to motivate customers to share feedback by telling customers that their feedback will have an impact on the organization (e.g., “Have your say in our company’s direction”). We examine whether such “impact appeals” indeed increase compliance with customer feedback requests. In a field experiment across seven countries, 430,666 customers of a Fortune 500 company received a customer feedback survey invitation email where the subject lines were manipulated. Contrary to our initial prediction and expert forecasts, we found that impact appeals on average decreased feedback provision (compared to a straightforward control message). Importantly, impact appeals backfired to a greater extent in countries with lower trust in business (e.g., Japan) than in countries with higher trust in business (e.g., China). We theorize that impact appeals are more likely to reduce compliance among customers with lower trust in business because these customers perceive impact appeals as more inauthentic. Pre-registered lab experiments (N=7,926) support our theoretical account and test more effective impact appeals informed by it. This research sheds light on when and why highlighting impact can fail to motivate customers and even backfire, and more generally, it advances the field’s understanding of what drives customer engagement in empowering behaviors.
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Mental Accounting for Consumer Stock Returns

Morrison Center Working Paper No. 22-018

Stephen Spiller, Associate Professor of Marketing and Behavioral Decision Making, Associate Dean of Anderson Ph.D. Program, UCLA Anderson
David Dolifka, Marketing Ph.D. Student, UCLA Anderson
Eitan Rude, Marketing Ph.D. Student, UCLA Anderson
 

Do Different Forms of Prospection Lead to Different Emotional Outcomes?

Morrison Center Working Paper No. 21-001

Tayler Bergstrom, PhD Student, Marketing, UCLA Anderson School of Management
Hal Hershfield, Professor of Marketing and Behavioral Decision Making, UCLA Anderson School of Management

Thoughts of the future are commonplace in the daily lives of consumers. Yet, considering the future, with its various uncertainties, can be an intimidating and anxiety-provoking exercise. Yet, no work to date has investigated the ways in which various methods of prospection impact the present-day and anticipated emotions that consumers experience. In this project, we set out to compare different methods of prospection against one another in an attempt to determine which, if any, may benefit consumers. Initial results indicated that not all forms of prospection are created equal: participants who engaged in planning and set intentions indicated that they felt more positive in the current moment than those in the control condition, whereas simulation and prediction afforded no such benefits. We are planning to conduct an additional set of 3 studies to further investigate the emotional outcomes that vary with each prospection type, and to test potential mediators of the relationships we uncover.

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Leveraging Past Adversity to Increase Vaccination Behavior

Morrison Center Working Paper No. 21-002

Ilana Brody, PhD Student, Behavioral Decision Making, UCLA Anderson School of Management
Hal Hershfield, Professor of Marketing and Behavioral Decision Making, UCLA Anderson School of Management

Although preventative behaviors are critical for health and well-being, they are also challenging to motivate, particularly among those without an established routine who may be least likely to engage in prevention behaviors. As a result, motivating preventative behaviors, or actions taken today to prevent future adversity, has presented a longstanding behavioral challenge as well as an opportunity for improving welfare. In this research, we aim to demonstrate a key source of heterogeneity in interventions that aim to motivate such preventative behaviors. We will specifically investigate whether calling to mind one’s past adversity in the health or financial wellness domains can encourage preventative behavior, and predict that this messaging intervention will be uniquely effective for those who have been exposed to related adversity. These findings contribute practical insights for social psychological interventions to account for individual-level heterogeneity and increase welfare among those who are most vulnerable to adversity.

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Rationalization Reduction: Intervention Science to Promote Moral Action

Morrison Center Working Paper No. 21-003

Ilana Brody, PhD Student, Behavioral Decision Making, UCLA Anderson School of Management
Eugene Caruso, Associate Professor of Management and Organizations, UCLA Anderson School of Management
Noah J. Goldstein, Professor of Management and Organizations, UCLA Anderson School of Management

Moral rationalization is the process of convincing oneself that an action does not actually violate one’s moral standards (Tsang, 2002). As a result, rationalization fosters an environment conducive to immoral action, and thus is harmful for both individuals and society. The primary purpose of this research is to study the process of rationalization, investigate methods for combating this process, and develop an engaging and interactive intervention that employs these rationalization reduction methods. By interrupting the process that liberates individuals to break with their moral standards, this research serves to reduce immoral behavior and improve the wellbeing of individuals and society.

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How People Perceive Invasiveness

Morrison Center Working Paper No. 21-004

Jon Bogard, PhD Student, Behavioral Decision Making, UCLA Anderson School of Management
Eugene Caruso, Associate Professor of Management and Organizations, UCLA Anderson School of Management
Megan Weber, PhD Student, Behavioral Decision Making, UCLA Anderson School of Management

From deadly viruses that infect our bodies to Siri and Alexa listening to everything we say, concerns over unwanted or unnatural intrusions are common in today’s society. In all of these contexts, a label using a variation of the word “invasive” might be applied (i.e., an invasive disease, an invasion of privacy). Although the normative implications in these specific contexts are fairly clear, where less invasive diseases or technologies are better than the alternative, there are other settings in which a label of “invasive” might come along with different assumptions or values. For example, a patient choosing between treatment options for a cancerous tumor might infer higher rates of success for an invasive surgery vs. a noninvasive approach. In the present research, we seek to explore the assumptions, values, and consequences of practices varying in invasiveness across two key settings with important but distinct implications for consumer choice: consumer privacy and medicine. Specifically, we will investigate how consumers, patients, and doctors define and perceive invasiveness and how potential differences in their interpretations influence judgments and choices.

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The Impact of Policy Framing on Narratives for Poverty and Prosperity

Morrison Center Working Paper No. 21-005

Ilana Brody, PhD Student, Behavioral Decision Making, UCLA Anderson School of Management
Sherry Jueyu Wu, Assistant Professor of Management and Organizations, UCLA Anderson School of Management
Megan Weber, PhD Student, Behavioral Decision Making, UCLA Anderson School of Management

In just the past four decades, the wealth gap between the richest and poorest families in the United States has grown at an astounding rate: in 1983, families in the top income tier had 28 times the wealth of families in the lowest tier, but by 2016, this grew to 75 times (Pew Research Center, 2020). The consequences of this rapidly rising inequality go beyond the harmful financial consequences for those living in poverty, contributing to imbalances in political power, happiness, and wellbeing (Buttrick & Oishi, 2017; Hing et al., 2019). One of the main tools that a government has to address inequality is redistributive policy, including the use of taxes on the wealthy to provide benefits and services to those in need. Existing evidence suggests that support for redistributive policies is associated with beliefs about whether poverty is driven by dispositional or situational factors. In this research, we investigate (1) whether existing attributions differ for poverty and prosperity, (2) how the framing of redistributive policies conveys narratives around attributions for poverty and prosperity, and (3) how these narratives affect individually held beliefs about the determinants for poverty and prosperity.

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The Interactive Effects of the Three Dimensions of Social Norms Comparisons

Morrison Center Working Paper No. 21-006

Noah Goldstein, Professor of Management and Organizations, UCLA Anderson School of Management
Jon Bogard, Ph.D. Student, Behavioral Decision Making, UCLA Anderson School of Management

Any time you log into Netflix and see “Popular on Netflix Now” or receive a household energy bill comparing your consumption to your neighbors’, someone is trying to influence your decisions by comparing your behavior to a social norm. In past research (Bogard, Delmas, Goldstein, and Vezich, 2020), we demonstrated that this sort of normative feedback is not a monolith, as scholars have typically treated it, but instead contains three separate dimensions: The target (i.e., the specific reference group used as the benchmark), the Valence (i.e., whether one has outperformed or under-performed the Target), and the Distance (i.e., how far from the Target one’s performance is). Whenever someone receives normative feedback, we showed, they are actually receiving information along each of these three dimensions. Through several field and laboratory studies, we documented the independent effect of each dimension on people’s behavioral response to normative feedback.

These findings invite a natural question: How do these three dimensions interact? That is, how does the effect of one dimension depend on the specific values of the others? Is negatively valenced feedback always bad, or might slightly negative feedback actually improve performance more than moderately positive feedback? Does it depend on whether performance is being compared against a low-, middle-, or top-performer? The goal of the present investigation is to answer these sorts of questions.

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Grocery Store Closures and Household Nutritional Choices

Morrison Center Working Paper No. 21-007

Julia Levine, Ph.D. Student, Marketing, UCLA Anderson School of Management
Sylvia Hristakeva, Assistant Professor of Marketing, UCLA Anderson School of Management

We analyze the impact of a temporary shock to food supply on households' dietary choices. We use hurricane-induced closures of grocery stores, which are typically short term. Results show that store closures influence household purchasing patterns even after the grocery store has reopened. We find a decrease in the nutritional value of household purchases for the six-month period after the store has reopened, despite no change in total expenditures. This finding supports the hypothesis that supply factors play a substantial role in shaping household diets.

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Is Money More Valued than Time in Cost Transparent Prices?

Morrison Center Working Paper No. 21-008

David Dolifka, Ph.D. Student, Marketing, UCLA Anderson School of Management
Franklin Shaddy, Assistant Professor of Marketing and Behavioral Decision Making, UCLA Anderson School of Management
Neha Nair, Ph.D. Student, Marketing, UCLA Anderson School of Management

How do consumers assess whether to purchase products at a given price? One approach is to consider whether prices equitably reflect input costs. A company could present labor costs in terms of either time or money e.g., “1/2 hour” vs. “$7.50” of labor (for a fixed rate of $15/hour). Prior research shows that time is often substituted for other attributes (e.g., content, quality) and that highlighting time or human effort might increase valuations. Given this, we might expect companies to be better-off when communicating costs framed in terms of time, instead of money. However, results from four pilot experiments seem to suggest the opposite. In these studies, consumers indicated being more likely to purchase a product when costs were framed in terms of money rather than time. Furthermore, participants perceived greater time investment for products framed by financial transparent costs, rather than temporal transparent costs and this time investment was strongly associated with purchase likelihood. Our initial findings seemingly challenge the conventional wisdom from the literature; however, they are not mutually incompatible. Instead, our work may shed light upon how framing costs in terms of money may paradoxically increase perceptions of invested time.

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Consumer Spending in Response to Income or Balance Information

Morrison Center Working Paper No. 21-009

David Dolifka, Ph.D. Student, Marketing, UCLA Anderson School of Management
Stephanie Smith, Ph.D. Student, Behavioral Decision Making, UCLA Anderson School of Management
Stephen Spiller, Associate Professor of Marketing and Behavioral Decision Making

Consumers dislike debt and utilize many strategies to avoid it. We propose one such strategy by considering how consumers respond to information about incomes vs. balances. Income is a flow and represents the rate at which a consumer’s balance grows. Balance is a stock, representing the accumulation of prior inflows (income) and outflows (spending). Though mathematically translatable (either can be derived from the other), we propose consumer spending may be sensitive to either income or balance information. Specifically, we propose income information will cause people to systematically underspend their financial inflows in a strategic attempt to avoid balance deficits. This strategy avoids debt; however, it also leads to accumulation. Whereas consumers who observe balance information may repeatedly spend down their accounts, consumers with only income information will accumulate balance from unspent inflows. Results from a preregistered and incentivized experimental game lend support to these predictions. Across four between-subject conditions, participants underspend their income most frequently—and therefore accumulate more money over time—when presented with information about their income and not their balance. This ongoing research seeks to further our understanding of how and why consumers make spending decisions in the face of different forms of financial information.

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The Role of Claim Objectivity on Source Memory

Morrison Center Working Paper No. 21-010

Daniel Mirny, Ph.D. Student, Marketing, UCLA Anderson School of Management
Stephen Spiller, Associate Professor of Marketing and Behavioral Decision Making

In choice contexts, consumers frequently consider past information received from other people. Friends share their experiences from restaurants, critics write movie reviews, and past guests leave online reviews for an AirBnB. Source memory, the ability to link a claim to its original source, is an essential aspect of accurate recall, attitude formation, and subsequent decision making. Across a set of pre-registered experiments (N = 3,308), and a variety of consumer environments, we find that source memory is more accurate for subjective opinions than for objective factual statements, indicating that opinions are more likely to be correctly attributed to their sources than are factual statements.

With the main effect robustly observed, we aim to understand the downstream consequences, boundary conditions, and underlying processes of this effect. One ongoing set of studies focuses on the role of source expertise. Another set of studies manipulates the perceived objectivity of individual claims as well as the extent to which claims provide information about the source, to understand the processes of the observed effect of claim objectivity on source memory. In this research, we replicate and expand upon an important observed effect, aiming to further our understanding of the role of claim objectivity in source memory.

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Biased Prestige Inferences and How to Correct Them

Morrison Center Working Paper No. 21-011

Gloria Danqiao Cheng, Ph.D. Student, Management and Organizations, UCLA Anderson School of Management
Jana Gallus, Associate Professor of Strategy and Behavioral Decision Making, UCLA Anderson School of Management
Serena Does

This research first examines whether and under what conditions inferences about the prestige of an award suffer when women or racial minorities win the award (“If she won this award, it cannot have been that important”). And second, how to prevent such biased prestige inferences. We conduct lab experiments to study how award recipients from diverse backgrounds impact perceptions of the award. Our focus lies on scholarly awards in STEM fields, where we vary the stereotypicality of the awards by comparing research excellence awards (stereotypically given to white male, high status) to service awards. We predict that awards will be deemed less prestigious when women and racial minorities win them. Moreover, we predict that the stereotypicality of awards moderates this effect. We hypothesize that the prestige of research excellence awards (stereotypically given to white males) will be derogated to a greater extent with minority recipients (vs majority recipients) than service awards. Lastly, we test what interventions can reduce or eliminate such biased prestige evaluations. We predict that a greater award value (prize money) and more information on the selection process (e.g., the jury) will close the perceived prestige gap between majority and minority award recipients.

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Stuck In A Rut: The Behavioral Entrenchment Effect

Morrison Center Working Paper No. 21-012

On Amir, Professor of Marketing, UC San Diego Rady School of Management
Ziv Carmon, Professor of Marketing, INSEAD
Alicea Lieberman, Assistant Professor of Marketing, UCLA Anderson School of Management

People often get stuck in ruts, continuing unfavorable activities when they could easily switch to preferred alternatives. We deem such behaviors—continuing less-preferred activities while passing up clear opportunities for improvement—change failures. Daily life is filled with instances of change failures—envision an individual struggling to complete a task on their phone (e.g., read, shop, email) rather than switching to a nearby computer where they could do it more easily; or, consider someone continuing to watch an unenjoyable TV program, rather than switching to the fun book sitting next to them on the side table. We propose such behavior-change failures are driven, in part, by a novel underlying cause: behavioral entrenchment, a state of increasing task-set accessibility that makes switching feel more difficult. We aim to further examine behavioral entrenchment, improve our understanding of why it occurs, and identify interventions to attenuate it. More generally, this research will shed light on why people get stuck in ruts and provide insights to help manage behavior change.

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Perceptions of Fairness in Segmentation and Targeting

Morrison Center Working Paper No. 21-013

Elizabeth M.S. Friedman, Assistant Professor of Business, Columbia Business School
Franklin Shaddy, Assistant Professor of Marketing and Behavioral Decision Making, UCLA Anderson School of Management
Olivier Toubia, Professor of Business, Columbia Business School

Segmentation and targeting are cornerstones of marketing strategy. Segmentation refers to the practice of dividing a market into distinct groups, while targeting describes the selection of which of those groups to serve. Often, these groups are defined by demographic characteristics like race or gender. However, recent cultural movements like Black Lives Matter and #MeToo have heightened concerns about social justice, and now segmentation and targeting by race and gender may seem increasingly inappropriate. These examples raise a natural question, given the ubiquity of these strategies: Do consumers today believe such practices are fair? In this research, we find that perceptions of fairness suffer when advertising specifically targets groups based on race or gender, relative to advertising that broadly engages the general public—even when promoted products and services would be beneficial to the targeted segment.

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Understanding How Consumers Incorporate and Estimate Uncertainty

Morrison Center Working Paper No. 21-014

Stephen Spiller, Associate Professor of Marketing and Behavioral Decision Making, UCLA Anderson School of Management
David Zimmerman, Ph.D. Student, Behavioral Decision Making, UCLA Anderson School of Management

Decisions under uncertainty are ubiquitous, from estimating the travel time to a destination to deciding what city is most attractive. People need to both learn information that will inform their expectations about uncertain outcomes (Oliver and Winer 1987) and to evaluate options with uncertain attributes (Tversky and Kahneman 1992). While there is extensive research on multi-attribute choice problems (Wallen et al. 2008), this has largely focused on attributes that are known or that are risky. By moving to uncertain attributes, researchers must also account for how people learn and incorporate information that is uncertain (Hasher and Zacks 1979; Hertwig 2015). In one project, we test the impact of metrics on estimates of uncertainty (e.g., how the estimate of a distribution of buyer offers on a house changes when estimated in sale price or home equity). The second project tests how people make choices with multiple, correlated uncertain attributes. Correlated attributes, but specifically negatively correlated attributes, tend to defy the predictions of many choice models (Johnson, Meyer, and Ghose 1989) and thus deserve additional investigation into preference formation.

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An Analysis of Excess Entry in the U.S. Discount Retail Sector

Morrison Center Working Paper No. 21-015

El Hadi Caoui, Assistant Professor of Strategic Management, University of Toronto
Brett Hollenbeck, Assistant Professor of Marketing, UCLA Anderson School of Management
Matthew Osborne, Associate Professor of Marketing, Department of Management, University of Toronto

This paper studies the expansion of dollar store chains in the U.S. retail landscape following the Great Recession (2008–2019). This expansion has been accompanied by growing public concern over the impact on other local retailers and food accessibility in small, rural communities. We develop an empirical framework to evaluate the efficiency of the free entry equilibrium and impact of entry regulation on spatial market structure. A dynamic game of entry, exit and investment into spatially differentiated locations is specified, allowing for chain-level economies of density.

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What Motivates Social Security Claiming Age Intentions? Testing Behaviorally-Informed Interventions Alongside Individual Differences

Morrison Center Working Paper No. 21-016

Adam Eric Greenberg, Assistant Professor of Marketing, Bocconi University
Hal Hershfield, Professor of Marketing and Behavioral Decision Making, UCLA Anderson School of Management
Suzanne Shu, Professor Emeritus, UCLA Anderson School of Management
Stephen Spiller, Associate Professor of Marketing and Behavioral Decision Making, UCLA Anderson School of Management

Choosing when to claim Social Security Administration (SSA) benefits is a critical determinant of financial health during retirement. Complicating this important decision is the role of heterogeneity; each individual’s decision is affected by individual factors that limit the usefulness of standardized advice. While past work has examined heterogeneity in claiming decisions, there has been little research to systematically test the psychosocial correlates of early or delayed SSA claiming or the effectiveness of theory-driven interventions meant to help with the claiming decision. Given that prior research has typically tested one intervention or individual difference at a time, we systematically examined how several different interventions affect when consumers intend to claim SSA benefits and how such intentions correlate with individual differences. Using a pre-registered design with replications, we analyzed intended claiming age as a function of theory-driven interventions, individual difference measures, and relevant interactions between interventions and individual differences. In so doing, we not only generate better predictive models of which retirees will decide to claim earlier or later, but also provide a methodological roadmap for data-driven theory building for complex consumer decisions.

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Modeling Consumer Choice Using Eye-Tracking

Morrison Center Working Paper No. 21-017

Stephanie Smith, Ph.D. Student, Behavioral Decision Making, UCLA Anderson School of Management
Stephen Spiller, Associate Professor of Marketing and Behavioral Decision Making, UCLA Anderson School of Management

When confronted with a set of alternatives, how do consumers choose? This project aims to advance our understanding of consumer choice processes in two important particular contexts through the use of eye-tracking. First, we examine the role of attention to specific attributes and how it varies across joint vs. separate evaluation (e.g., Hsee 1996). We will assess the extent to which the effect of attribute comparisons is driven by (a) attention to those attributes, and/or (b) weight assigned to those attributes, conditional on attention. Through online pilot testing, we have already developed a validated set of stimuli for this project. Second, we will examine multi-stage decisions. Recent behavioral work (Spiller & Ariely 2020) has considered how evaluation of a choice between options (e.g., a gift card that can be used at one of two different stores) depends on its average use rather than just its more-preferred use. Even more recently, we have extended these results to situations with objective (rather than subjective) dominance in preferences. Moving forward, measuring visual attention and modeling its effects on choice, we aim to better understand how value is integrated across alternatives when one immediate option opens the door to multiple differentiated subsequent options.

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If death is the great tragedy of human life, could rituals, by helping us connect backward to heritage and forward to the future, suppress time and reduce our fear of the end of life?

Morrison Center Working Paper No. 20-001

Kate Christensen | Joint research with Hal Hershfield

Abstract: Consumers often adopt a "give-it-to-me-now" mindset, choosing to spend in the present rather than save for the future. They choose to purchase material goods that generate unhappiness inducing social comparison (purses, cars) rather than experience goods (vacations) that lead to greater happiness over time (Van Boven and Gilovitch 2003). How can we help consumers spend less on material goods and invest more in the life experiences (vacation, retirement) that make them happy? Cozzolino et al. (2004) have written that thinking about the end of life can lead to a decreased interest in both possessions and wealth. To the extent that consumers are aware of the temporal limits of human life, we hypothesize that time will appear to be more valuable and money will appear to be less valuable; intertemporal discount rates will decrease and saving for the future will become easier. A decreased interest in possessions might also lead to an increased preference for experience goods. These preferences will likely vary depending on characteristics of the decision problem (e.g., mortality salience), decision situation (e.g., if the consumer is under time pressure), and the decision maker (e.g., if the consumer is more or less experienced at choice-making). This study will advance understanding of how consumer choices vary when they feel that life is limited and so will have applied value for business and public policy.

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Urgency in Consumer Decision Making

Morrison Center Working Paper No. 20-002

Hal Hershfield | Joint research with Joseph Reiff

Abstract: Many societal challenges facing consumers, such as mitigating climate change or increasing retirement savings, are said to require urgency. Yet, researchers have only just started exploring the construct of urgency and how it shapes judgments and decisions. What is urgency, why does it matter, and how can policy makers and marketers increase it? We plan to explore these questions in the current research program. Specifically, we define urgency as a preference for earlier action over later action. We plan to (1) develop a novel measure of urgency, showing that some people have a strong preference to act now, rather than later, even if that means forgoing significant amounts of money, (2) show that this preference negatively predicts consumer demand for certain behaviors that require delayed actions (e.g., borrowing, pre-commitment), and (3) show how to frame products to increase take-up by appealing to urgency. 

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Misperception about stigma as a potential barrier to applying for benefits programs

Morrison Center Working Paper No. 20-003

Sherry Wu | Joint research with Eugene Caruso and Alice Lee-Yoo

Abstract: Numerous health and nutrition-related benefits programs are available in the US. One example is CalFresh in California and Colorado, a food stamps program designed to improve economic and health outcomes for low-income individuals and families. Yet, nearly 30% of people living in poverty today do not apply for the benefits they are eligible for. We hypothesize that much of this attrition can be eliminated by reducing psychological barriers driven by applicants' beliefs and narratives about the program. Our data suggest that one potential mechanism that may drive people away from applying for the benefits is the stigma attached to receiving financial assistance. However, we find that this stigma is a misperception. In this research, we aim to develop and test theoretically-grounded interventions to increase take-up rates in these benefit programs and test whether correcting this misperception would increase take-up rates. 

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Interventions to Increase Support For Redistributive Policies

Morrison Center Working Paper No. 20-004

Franklin Shaddy | Joint research with Kate Christensen and David Dolifka

Abstract: The American Dream promises equal opportunity to achieve social mobility and economic success, no matter a person’s circumstances of birth or station in life. But today that promise seems to have been broken: The rich are getting richer, and the poor are getting poorer (​Global Wealth Report 2​019). As the divide between the “haves” and “have-nots” grows wider, redistributive policies are increasingly important to ensure equal access to opportunity. Yet, redistributive programs – such as wealth tax, estate tax, and “Baby Bonds” – remain largely unpopular. In this project, we aim to increase support for such policies by identifying and testing various interventions. Our approach is broadly aimed at shifting perceptions of fairness, which, in turn, should increase support for redistributive policies. We draw from research literatures exploring perceptions of time, desert, and empathy to design practical interventions capable of changing public opinion around redistribution.

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Why Do Consumers Ignore Hidden Costs?

Morrison Center Working Paper No. 20-005

Leila Bengali | Joint research with Jerry Nickelsburg

Abstract: Prior research documents that consumers appear to ignore hidden costs (costs not explicitly written on price tags) associated with products they buy. Using a series of experiments eliciting willingness to pay for common consumer products that have hidden costs, we investigate the sources of this inattention in an ongoing project. Our work to date suggests that lack of knowledge, forgetfulness, and incorrect information about hidden costs do not account for inattention. Much of the existing work documenting inattention has difficulty differentiating between these hypotheses. We find that participants demonstrate familiarity with the hidden costs of the products they see (ruling out lack of knowledge), yet willingness to pay is insensitive to reminders (indicating that consumers are not forgetful) and to the provision of objective information about hidden costs (ruling out incorrect information). In ongoing research, we test several additional explanations for inattention including the idea that cognitive distraction leads consumers to ignore hidden costs and that information must be shown visually on a price tag, rather than merely known, to grab the consumer’s attention. Our current and future findings will yield a better understanding of why and when hidden costs are likely to be ignored.

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Equity and environmental attitudes in adoption of rooftop solar photovoltaic in Los Angeles County

Morrison Center Working Paper No. 20-006

Charles Corbett | Joint research with Hal Hershfield and Timothy Malloy

Abstract: A recent paper in Nature Sustainability (Sunter et al. 2019) uses data from Google’s Project Sunroof to document that Black- and Hispanic-majority census tracts show significantly lower rates of solar PV installation, even after accounting for differences in household income and home ownership. As part of a project funded by the UCLA Sustainable Los Angeles (SLA) Grand Challenge, the current research team conducted a survey of 4,207 homeowners in Los Angeles County in April 2018. The survey focused on drivers of adoption of rooftop solar photovoltaic (PV). This project will focus on examining whether our survey responses shed new light on reasons for the disparities in adoption of rooftop solar documented by Sunter et al. (2019). For instance, we will explore to what extent these disparities also occur in LA County, and whether they are driven more by neighborhood-level, individual or other factors.

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The Role of Claim Objectivity on Source Memory

Morrison Center Working Paper No. 20-007

Stephen Spiller | Joint research with Daniel Mirny

Abstract: In choice contexts, consumers frequently consider past information received from other people. Friends share their experiences from restaurants, critics write movie reviews, and past guests leave online reviews for AirBnB rentals. In order to integrate past information into a decision, it is necessary to recall the source of the information, for matters of both quality (credibility) and taste (alignment with personal preferences). Through a series of studies, we explore how source memory for opinions differs from source memory for factual statements and investigate potential moderators. Preliminary findings suggest that consumers are better able to recall the sources of opinion claims than the sources of factual claims.

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Consumer Financial Decision Making

Morrison Center Working Paper No. 20-008

Stephen Spiller | Joint research with David Dolifka and Kate Christensen

Abstract: When consumers make financial decisions, they may consider both the supply and demand of their financial resources. In three related projects, we seek to better understand how consumers perceive their supply of available money. Our first project considers whether financial growth is treated like available money. To this end, we explore conditions under which consumers are more or less likely to track initial associations (such as earmarkings) to downstream financial growth. Preliminary results suggest the extent to which growth is treated as available money may depend on the strength of association between the growth and its source. A second project (with Stephanie Smith) presents equivalent supply information as both a daily income and a current balance. Using mouse-tracking data, we observe how preferentially attending to either presentation form is associated with consumer spending. Early findings suggest spending is greater when consumers attend more to balance information. Extending these results, a third project investigates individual differences in how consumers respond to changes in their supply of money. Specifically, we estimate individual sensitivity to financial changes presented as either stocks or flows. These three related projects will ultimately contribute to our understanding of how consumers assess their available supply of money.

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How Metrics Influence Elicited Prediction Intervals

Morrison Center Working Paper No. 20-009

Stephen Spiller | Joint research with David Zimmerman

Abstract: Metrics matter for consumer judgments and decisions (e.g., De Langhe & Puntoni 2016; Larrick & Soll 2008; Spiller, Reinholtz, & Maglio 2020). People make different decisions and judgments when considering different equivalent metrics, such as a car’s fuel efficiency in terms of miles per gallon (MPG) vs. gallons per 1,000 miles (GPkM), or the state of the economy in terms of jobs gained or lost vs. people employed. We propose two ways elicitation metrics may impact prediction interval judgments: symmetry and scaling. First, if people implicitly assume distributions are roughly normal (Flannagan, Fried, & Holyoak 1984), then metrics that are inverses of each other will become distorted when converted to the alternative representation. For example, prediction intervals which are symmetric when elicited in MPG or GPkM will typically not be in the alternative metric. Second, people may tend to believe that uncertainty scales with quantity, such that bigger quantities have greater uncertainty (Weber, Shafir, & Blias 2004). For example, predictions in a flow metric may typically have smaller prediction intervals than those in a stock metric because the units typically have smaller numeric values. These proposals reinforce the importance of attending to the metric of elicitation in judgmental forecasts.

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Examining the role of COVID-19 testing availability on intention to isolate: A Randomized hypothetical scenario

Morrison Center Working Paper No. 20-010

Kate Christensen

Background: Little information exists on how COVID-19 testing influences intentions to engage in risky behavior. Understanding the behavioral effects of diagnostic testing may highlight the role of adequate testing on controlling viral transmission. In order to evaluate these effects, simulated scenarios were conducted evaluating participant intentions to self-isolate based on COVID-19 diagnostic testing availability and results.

Methods: Participants from the United States were recruited through an online survey platform (Amazon Mechanical Turk) and randomized to one of three hypothetical scenarios. Each scenario asked participants to imagine having symptoms consistent with COVID-19 along with a clinical diagnosis from their physician. However, scenarios differed in either testing availability (testing available v. unavailable) or testing result (positive v. negative test). The primary outcome was intention to engage in high-risk COVID-19 behaviors, measured using an 11-item mean score (range 1-7) that was pre-registered prior to data collection. Multi-variable linear regression was used to compare the mean composite scores between conditions. The randomized survey was conducted between July 23rd to July 29th, 2020.

Results: A total of 1400 participants were recruited through a national, online, opt-in survey. Out of 1194 respondents (41.6% male, 58.4% female) with a median age of 38.5 years, participants who had no testing available in their clinical scenario showed significantly greater intentions to engage in behavior facilitating COVID-19 transmission compared to those who received a positive confirmatory test result scenario (mean absolute difference (SE): 0.14 (0.06), P = 0.016), equating to an 11.1% increase in mean score risky behavior intentions. Intention to engage in behaviors that can spread COVID-19 were also positively associated with male gender, poor health status, and Republican party affiliation.

Conclusion: Testing availability appears to play an independent role in influencing behaviors facilitating COVID-19 transmission. Such findings shed light on the possible negative externalities of testing unavailability.

Trial registration: Effect of Availability of COVID-19 Testing on Choice to Isolate and Socially Distance, NCT04459520, https://clinicaltrials.gov/ct2/show/NCT04459520

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Preferences for Suspense and Surprise in a Massive Online Computer Game

Morrison Center Working Paper No. 20-011

Paola Giuliano | Joint research with Ashvin Gandhi, Ph.D.

Abstract: What determines the entertainment value of a game? Ely, Frankel and Kamenica (2015) develop a formal model of suspense and surprise for analyzing entertainment value. We plan to apply their methodology using data from the video game League of Legends, a popular online game that combines real-time strategy, role-playing game elements and team coordination. League of Legends presents an ideal context to study the effects of suspense and surprise on enjoyment and engagement in leisure activities. In each of League of Legends’s matches the two potential outcomes are that one team (say, the Blue team) wins or loses. A period in a match has more suspense if the variance of the next period's probability that Blue Team wins is greater. A period has more surprise if the probability that Blue team wins is further from the last period's probability. Unlike typical sporting events, the people engaged in the game are predominantly players, not fans, and they exhibit measurable behavior. This allows us to link suspense and surprise of a match to an immediate objective behavior, such as player continuation. In addition, self-reported responses to “fun” surveys are recorded and constitute a way to measure enjoyment. In order to perform this analysis, we have acquired a unique dataset containing nearly 200 variables from Riot Games Inc., characterizing the minute-by-minute state (position, gold, experience, etc.) of approximately 10 million games. Our data also indicate whether players played prior to the observed game and continued with additional games afterward. For a small subset of the data, we also observe surveyed enjoyment.

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The Market for Fake Reviews

Morrison Center Working Paper No. 20-012

Brett Hollenbeck | Joint research with Sherry He and Davide Prosperio, Ph.D.

Abstract: We study the market for fake product reviews on Amazon.com. These reviews are purchased in large private internet groups on Facebook and other sites. We handcollect data on these markets to characterise the types of products that buy fake reviews and then collect large amounts of data on the ratings and reviews posted on Amazon for these products, as well as their sales rank, advertising and pricing behavior. We use this data to assess the costs and benefits of fake reviews to sellers and evaluate the degree to which they harm consumers. The theoretical literature on review fraud shows there exist conditions when they harm consumers and conditions where they function as simply another type of advertising. Using detailed data on product outcomes before and after they buy fake reviews we can directly determine if these are low-quality products using fake reviews to deceive and harm consumers or if they are possibly high-quality products who solicit reviews to establish reputations. We find that a wide array of products purchase fake reviews including products with many reviews and high average ratings. Soliciting fake reviews on Facebook leads to a significant increase in average rating and sales rank but the effect disappears after roughly 1 month. After firms stop buying fake reviews their average ratings fall significantly and the share of one-star reviews increases significantly, indicating fake reviews are mostly used by low quality products and are deceiving and harming consumers. We also observe that Amazon deletes large numbers of reviews and we document their deletion policy.

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Peer comparisons and choice architecture

Morrison Center Working Paper No. 20-013

Noah Goldstein | Joint research with Jon Bogard

People constantly receive information about their performance relative to others. Estimating these effects is complicated because, as we show, normative feedback includes several dimensions: Target (e.g., a reference group of average versus exemplary performers), Distance (e.g., being near versus far from a benchmark), and Valence (e.g., being better or worse than the benchmark). In Study 1, we randomly assign households to receive no feedback or feedback comparing their energy consumption to either their average or most efficient neighbors. Households compared to average neighbors decreased electricity usage by 6%, but those compared to efficient neighbors increased consumption by 4%. We decompose these effects into the separate influences of Target, Distance, and Valence. In Studies 2 and 3a-c, we randomly assign normative feedback to isolate the independent effects of Distance and Valence. Additionally, we find evidence for the mediating effect of motivation: The more dispiriting the feedback, the worse the subsequent performance.

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Effective altruism

Morrison Center Working Paper No. 20-014

Eugene Caruso | Joint research with Jon Bogard

Human Challenge Trials (HCTs) may be vital for rapid development of vaccines in response to novel pathogens with pandemic potential. While not effectively permitted in any countries, HCTs enjoy support in some recent polls. Preliminary research has exposed that people view HCTs as more ethical when they are considered in isolation than when explicitly compared to traditional vaccine development procedures. In this project, we ask why some (utilitarian) actions are viewed as ethically worse when compared to an alternative as opposed to when they're evaluated on their own.We propose -- and seek evidence consistent with the hypothesis -- that people are more deontological (i.e., act-focused rather than outcomes-focused) in joint- rather than separate-evaluation. In separate evaluation, people ask themselves, “Does this yield good outcomes?” whereas in joint evaluation people ask themselves, “Which method is ethically better?”

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Suspense, Surprise: What Makes a Match Fun and Engaging?

Morrison Center Working Paper No. 19-001

Ashvin Gandhi | Joint research with Paola Giuliano

Abstract: What determines the entertainment value of a game? Ely, Frankel, and Kamenica (2015) develop a formal model of suspense and surprise for analyzing entertainment value. We plan to apply their methodology using data from the video game League of Legends, a popular online game that combines real time strategy, role-playing game elements, and team coordination. League of Legendspresents an ideal context to study the effects of suspense and surprise on enjoyment and engagement in leisure activities. In each of League of Legends’s matches the two potential outcomes are that one team (say, the Blue team) wins or loses. A period in a match has more suspense if the variance of the next period's probability that Blue Team wins is greater. A period has more surprise if the probability that Blue team wins is further from the last period's probability. Unlike typical sporting events, the people engaged in the game are predominantly players, not fans, and they exhibit measurable behavior. This allows us to link suspense and surprise of a match to an immediate objective behavior, such as player continuation. In addition, self-reported responses to “fun” surveys are recorded and constitute a way to measure enjoyment. In order to perform this analysis, we have acquired a unique dataset containing nearly 200 variables from Riot Games, Inc. characterizing the minute-by-minute state (position, gold, experience, etc.) of approximately 10 million games. Our data also indicate whether players played prior to the observed game and continued with additional games afterwards. For a small subset of the data, we also observe surveyed enjoyment.

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CEO Activism and Public Mobilization

Morrison Center Working Paper No. 19-002

Christopher Poliquin | Joint research with Young Hou, Ph.D.

CEOs increasingly engage in activism on issues such as gun control, voting rights, and abortion. Although such activism may benefit their firms, the stated goal is often to mobilize the public and precipitate change. In an experiment with 4,578 respondents, we study the effect of CEO activism on people’s willingness to contact their U.S. senators about abortion. On average, showing a CEO message supporting abortion rights is not more effective at mobilizing pro-choice citizens than showing no message or showing a message from other speakers. Additionally, CEOs do not provoke countermobilization by people who oppose abortion. We explore heterogeneous treatment effects and find that CEO activism is better at motivating pro-choice citizens to engage in politics when their senators are Democrats and thus likely receptive to pro-choice activism, consistent with stakeholder alignment theory. Our findings contribute to research on social movements and mobilization in markets by examining the ability of CEOs and organizations to act as catalysts for social change.

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The Role of Attention in Evaluating Choices Among Choices

Morrison Center Working Paper No. 19-003

Stephen Spiller | Joint research with Stephanie Smith, Ph.D.

Abstract: How do consumers value sets of alternatives and choose among them? The normative value of a set is derived from the expected value of the best option in the set. As a result, adding options to a set can increase the normative value but not decrease it. Yet prior work has found that the perceived value of a choice set systematically deviates from this normative benchmark: When less-attractive options are included in a set, the perceived value of the set decreases. In this research, we study how such undervaluation relates to visual attention by measuring what consumers attend to during choice. Prior research has found a causal role of attention in choices between liked items: The more attention an option receives, the more likely it is to be chosen. In this work, we examine how allocation of attention among options within a set relates to the ultimate choice of that set and implied perceived value. Through measuring visual attention, we hope to better understand how value is integrated across alternatives when one immediate choice opens the door to additional choices down the road.

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Advertising Strategy in the Presence of Reviews: An Empirical Analysis

Morrison Center Working Paper No. 19-004

Brett Hollenbeck | Joint research with Sridhar Moorthy, Ph.D., and Davide Proserpio, Ph.D.

Abstract: We study the relationship between online reviews and advertising spending in the hotel industry. Combining a dataset of TripAdvisor reviews with other datasets describing these hotels’ advertising expenditures, we show, first, that online ratings have a causal demand-side effect on ad spending. Second, this effect is negative: Hotels with higher ratings spend less on advertising than hotels with lower ratings. This suggests that hotels treat TripAdvisor ratings and advertising spending as substitutes, not complements. Third, the relationship is stronger for independent hotels than for chains, and stronger in less differentiated markets than in more differentiated markets. The former suggests that a strong brand name continues to provide some immunity to reviews, and the latter suggests that the advertising response is stronger when ratings are more likely to be pivotal. Finally, we show that the relationship between online ratings and advertising has strengthened over time, just as TripAdvisor has become more popular, implying that firms respond to online reviews if and only if consumers respond to them.

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Taxation and Market Power in the Legal Marijuana Industry

Morrison Center Working Paper No. 19-005

Brett Hollenbeck | Joint research with Kosuke Uetake, Ph.D.

Abstract: In 2012, the state of Washington created a legal framework for production and retail sales of marijuana. Ten other U.S. states and Canada have followed. These states hope to generate tax revenue for their state budgets while limiting harms associated with marijuana sales and consumption. We use a unique administrative dataset containing all transactions in the history of the industry in Washington to evaluate the effectiveness of different tax and regulatory policies under consideration by policymakers and study the role of imperfect competition in determining these results. We use both a reduced form sufficient statistic approach and structural methods to show a number of results. First, Washington’s strict cap on firm entry has resulted in retailers with substantial market power. This market power has immediate consequences for both state tax revenue and consumer welfare. Second, because these entry restrictions have caused retailers to behave like local monopolists, the state could substantially increase revenue generated from marijuana legalization by acting as the retailer itself, as it did for alcohol sales until 2012, without a large increase in prices. Third, despite having the nation’s highest tax rate at 37%, marijuana in Washington is not overtaxed, as many policymakers in other states have argued. The high taxes do not result in lower revenue or a substantial black market. Instead, Washington is still on the upward-sloping portion of the Laffer curve, and the amount of revenue generated by a tax increase is significantly larger due to retailer market power than it would be under perfect competition. Our results suggest there is not widely available black market marijuana competing with legal retail sales. Finally, the high excise tax is primarily borne by consumers and not by firms, and there is a large social cost associated with each dollar raised.

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The Long-Term Effects of Price Promotions on Consumer Behavior: Evidence from a Field Experiment on Alibaba

Morrison Center Working Paper No. 19-006

Dennis J. Zhang1*, Hengchen Dai2*, Lingxiu Dong1 , Fangfang Qi3 , Nannan Zhang3 , Xiaofei Liu3 , Zhongyi Liu3 , Jiang Yang3 1. Olin Business School, Washington University in St. Louis 2. Anderson School of Management, University of California, Los Angeles 3. Alibaba Group Inc.

Abstract: We study how promotions affect consumer behavior on an online retailing platform in the long term. We focus on a specific promotion: offering consumers coupons for products that have been in their shopping carts for more than one day. In a randomized field experiment involving more than 100 million customers with Alibaba Group—China’s largest e-commerce company—we randomly assigned half of eligible customers to a treatment condition where they might receive promotions for products in their shopping carts, while the other half of eligible customers did not receive coupons. We document unintended consequences of this promotion program during the month following our treatment period. On the positive side, our promotion program boosted consumer engagement, increasing the daily number of products customers viewed as well as customers’ daily purchase likelihood on the platform during the post-treatment period. On the negative side, we find that our promotion program intensified strategic consumer behaviors in two ways. First, receiving our promotions in the treatment period increased the proportion of products that consumers added to their shopping carts upon viewing them in the post-treatment period, possibly due to customers’ anticipation of promotions targeted at products in their shopping carts. Second, receiving our promotions in the treatment period lowered the prices customers paid for products in the post-treatment period. This effect holds for products that did not offer shopping-cart promotions, suggesting that prior use of shopping-cart promotions made people more price sensitive and trained them to search for other promotion mechanisms beyond shopping-cart-specific promotions. Importantly, both the positive and negative long-term effects spilled over to sellers on the same retailing platform that did not previously offer promotions to consumers. Our findings suggest that price promotions may change expectations and reference points, which can further produce both a positive long-term effect on consumer engagement and a negative long-term effect on strategic behavior. We discuss the practical implications of our findings for platforms and retailers.

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The Value of Pop-up Stores in Driving Online Engagement in Platform Retailing: Evidence from a Large-Scale Field Experiment with Alibaba

Morrison Center Working Paper No. 19-007

Dennis J. Zhang1*, Hengchen Dai2*, Lingxiu Dong1 , Qian Wu3 , Lifan Guo3 and Xiaofei Liu3 1. Olin Business School, Washington University in St. Louis 2. Anderson School of Business, University of California at Los Angeles 3. Alibaba Group Inc.

Abstract: We study the value of short-lived and experiential-oriented pop-up stores, a popular type of omnichannel retail strategy, on both retailers that participate in pop-up store events and retailing platforms that host these retailers. We conduct a large-scale, randomized field experiment with Alibaba Group involving approximately 800,000 customers. We randomly assign consumers to either receive a message about an upcoming weeklong pop-up store event organized by Alibaba’s business-to-consumer platform (Tmall.com) or not receive any message about the event. We find that our message increased foot traffic to the pop-up store and in turn boosted expenditure at participating retailers’ online stores at Tmall after the event ended. Furthermore, we use advanced Wi-Fi technology to track customers’ visits to the pop-up store—a missing component from past research that commonly relies on point-of-sales data. We find that pop-up store visits substantially increased customers’ subsequent expenditure at participating retailers’ Tmall stores. In addition, from a platform perspective, we show that pop-up store visits increased customers’ purchases at retailers that sell related products on Tmall but did not participate in the pop-up store event. Additional analyses shed light on possible mechanisms underlying the cross-channel and spillover effects of pop-up stores and demonstrate that these effects were concentrated on prospective consumers.

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A Theory of Goal Maintenance: A Distinct and Vivid Pre-Goal Self Predicts Post-Goal Maintenance Motivation

Morrison Center Working Paper No. 19-008

Author(s): John, Elicia, Advisor(s): Hershfield, Hal E, Shu, Suzanne B.

Abstract: I develop and test a theory of goal maintenance that posits that individuals who achieve a life-changing goal — such as getting out of debt, becoming sober or losing a substantial amount of weight — are more likely to maintain the progress achieved during goal pursuit if they psychologically distance themselves from the pre-goal self and routinely engage in activities that activate memories of the past, less-flattering self. This theory of goal maintenance builds on prior research in identity appraisal (Wilson & Ross, 2001), vividness and intertemporal choice (Hershfield et al., 2011), and self-discrepancy (Higgins, 1987) as it relates intertemporal discrepancies in self-state representation to motivation and behavior. I applied this theory of goal maintenance to weight-loss maintenance. Through a series of six studies, I provide evidence that goal maintenance is a distinct psychological phenomenon from goal pursuit along the dimensions of past self-salience and psychological distance; and I also show that activating memories of a past, overweight self and feeling more psychologically distant from this self lead to implicit goal maintenance behavior, such as a higher willingness to pay for healthy versus unhealthy items and greater interest in learning about healthy behaviors and topics. Additionally, I provide evidence across studies that past self-salience is more associated with a prevention regulatory focus (i.e., preventing unhealthy behaviors), whereas psychological distance is more associated with a promotion regulatory focus (i.e., promoting healthy behaviors). Further, a longitudinal study of a small sample of individuals examined whether the positive effects of salience and psychological distance on weight-maintenance behaviors may persist over time and outside of a laboratory environment.

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Prospective Retrospection

Morrison Center Working Paper No. 19-009

Noah Goldstein | Joint research with Eugene Caruso and Jon Bogard
When trying to persuade someone to adopt a new behavior (e.g. stop procrastinating, buy insurance, use suntan lotion, eat your vegetables), we are faced with a decision about the most effective means of persuasion. Should we extoll the benefits of the behavior ("veggies will make you healthy!"), use social norms ("85% of people eat veggies daily"), or use a fear tactic ("you'll get sick and overweight if you don't eat veggies")? Research has shown that fear appeals are often most compelling but can also backfire in certain conditions, especially when the person we're trying to persuade feels powerless. In this study, we investigate a new kind of persuasion tactic: prospective retrospection. We hypothesize that, beyond simulating the bad outcome for people, if you also simulate the regret they'll feel for not having made a good choice *in this moment* you can effectively persuade more people to adopt a behavior. We predict, for instance, that "Think about how you'll regret not using sunblock now if you're sunburned in 45 minutes" will be a more effective persuasion tactic than "Think about how you'll regret having a sunburn in 45 minutes." In this project, we test those and related ideas.
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Heritage Lost: How Connection to the Past Shapes Consumer Valuation in the Present

Morrison Center Working Paper No. 19-010

Kate Christensen | Joint research with Suzanne Shu

Owners value heritage goods, items that connect them to a shared past, whether through their alma mater or their family history. This research considers the impact of heritage on owners who wish to sell such goods. In five studies, we demonstrate that sellers have a lower willingness-to-accept (WTA) for heritage goods when selling to buyers with a shared heritage connection relative to buyers without this connection (i.e., a heritage discount). This heritage discount cannot be explained by in-group favoritism, sentimental value, or appropriateness of buyer usage and persists even when sellers perceive that the buyer has a higher willingness-to-pay (WTP). We provide process evidence that the effect of the buyer’s identity on the seller’s WTA is driven by concerns about heritage loss. Our findings contribute to literatures on sharing, sentimental goods, psychological ownership, and the endowment effect, and have marketing implications for consumer goods (e.g., collectibles) that derive product value by connecting consumers to meaningful history and traditions.

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Hypocrisy

Morrison Center Working Paper No. 19-011

Aimee Drolet | Joint research with Cassandra Davis

Menu framing

Morrison Center Working Paper No. 19-012

Aimee Drolet | Joint research with Hannah Malan

VIP Effect in Service Settings

Morrison Center Working Paper No. 19-013

Aimee Drolet | Joint research with Alexandra Polyakova