The effect of incomplete information on the compromise effect
Journal Title: Judgment and Decision Making - Year 2012, Vol 7, Issue 2
Abstract
Most research on the compromise effect focuses on how consumers make their decisions in a complete information scenario; however, consumers generally lack sufficient information when they make purchase decisions. This research aims to explore the compromise effect with incomplete information. Three studies were conducted to examine the research hypotheses. The main findings was that consumers are more likely to choose the middle option when they have incomplete information than when they have complete information. Further, the compromise effect decreases when consumers can choose to defer their decision in an incomplete information scenario. Finally, the compromise effect decreases when consumers are asked to infer missing attribute values from the incomplete information.
Authors and Affiliations
Shih-Chieh Chuang, Danny Tengti Kao, Yin-Hui Cheng and Chu-An Chou
Individuals’ insight into intrapersonal externalities
An intrapersonal externality exists when an individual’s decisions affect the outcomes of her future decisions. It can result in decreasing or increasing average returns to the rate of consumption, as occurs in addiction...
Winning a battle but losing the war: On the drawbacks of using the anchoring tactic in distributive negotiations
In two experiments, we explored the possible drawbacks of applying the anchoring tactic in a negotiation context. In Study 1, buyers who used the anchoring tactic made higher profits, but their counterparts thought their...
Pay as much as you can afford: Counterpart’s ability to pay and first offers in negotiation
Three experiments investigated the relations between buyers’ wealth or ability to pay (ATP) and sellers’ first offers. Study 1 demonstrated a positive correlation between sellers’ first offers and their perceptions of th...
When a risky prospect is valued more than its best possible outcome
In this paper, we document a violation of normative and descriptive models of decision making under risk. In contrast to uncertainty effects found by Gneezy, List and Wu (2006), some subjects in our experiments valued lo...
Predecisional information distortion in physicians’ diagnostic judgments: Strengthening a leading hypothesis or weakening its competitor?
Decision makers have been found to bias their interpretation of incoming information to support an emerging judgment (predecisional information distortion). This is a robust finding in human judgment, and was recently al...