Advanced Search
MyIDEAS: Login

How different are real and hypothetical decisions? Overestimation, contrast and assimilation in social interaction

Contents:

Author Info

  • Vlaev, Ivo
Registered author(s):

    Abstract

    Decision researchers conduct laboratory experiments of choice between real rewards, but also often rely on asking people to provide hypothetical answers to fictitious situations. Applying results from such studies to real-world situations requires understanding how decision making in cases involving real rewards correspond to decisions with hypothetical rewards. This article reports two key differences between hypothetical and real decisions in social dilemmas. First, hypothetical and real decisions cause different cognitive biases in social dilemmas: hypothetical judgements and choices stem from perceptual processes and cause contrast effects; while judgements and actions in real interaction are biased by assimilation processes involved in action selection and learning. Second, without the corrective real social interaction, people overestimate theirs and others propensity to act cooperatively. However, individuals are more confident in their predictions during real interaction, which suggests that such metacognitive judgments can predict actual behaviour and also signal when respondents provide biased responses. Overall, our results call into question established methodologies that rely on hypothetical answers, and indicate that people should be observed and measured in real or incentivised social interactions.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://www.sciencedirect.com/science/article/pii/S0167487012000645
    Download Restriction: Full text for ScienceDirect subscribers only

    As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

    Bibliographic Info

    Article provided by Elsevier in its journal Journal of Economic Psychology.

    Volume (Year): 33 (2012)
    Issue (Month): 5 ()
    Pages: 963-972

    as in new window
    Handle: RePEc:eee:joepsy:v:33:y:2012:i:5:p:963-972

    Contact details of provider:
    Web page: http://www.elsevier.com/locate/joep

    Related research

    Keywords: Judgment; Decision making; Cooperation; Social interaction; Context effects; Cognitive biases;

    Find related papers by JEL classification:

    References

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
    as in new window
    1. Ivo Vlaev & Nick Chater, 2008. "Debiasing context effects in strategic decisions: Playing against a consistent opponent can correct perceptual but not reinforcement biases," Judgment and Decision Making, Society for Judgment and Decision Making, vol. 3(6), pages 463-475, August.
    2. Robin J. Tanner & Kurt A. Carlson, 2009. "Unrealistically Optimistic Consumers: A Selective Hypothesis Testing Account for Optimism in Predictions of Future Behavior," Journal of Consumer Research, University of Chicago Press, vol. 35(5), pages 810-822, October.
    3. Drew Fudenberg & Jean Tirole, 1991. "Game Theory," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262061414, January.
    4. Karen Blumenschein & Magnus Johannesson & Glenn C. Blomquist & Bengt Liljas & Richard M. O’Conor, 1998. "Experimental Results on Expressed Certainty and Hypothetical Bias in Contingent Valuation," Southern Economic Journal, Southern Economic Association, vol. 65(1), pages 169-177, July.
    5. repec:ebl:ecbull:v:3:y:2004:i:6:p:1-13 is not listed on IDEAS
    6. Matthew L. Locey & Bryan A. Jones & Howard Rachlin, 2011. "Real and hypothetical rewards in self-control and social discounting," Judgment and Decision Making, Society for Judgment and Decision Making, vol. 6(6), pages 552-564, August.
    7. Loomes, Graham, 2006. "(How) Can we value health, safety and the environment?," Journal of Economic Psychology, Elsevier, vol. 27(6), pages 713-736, December.
    8. Kuhberger, Anton & Schulte-Mecklenbeck, Michael & Perner, Josef, 2002. "Framing decisions: Hypothetical and real," Organizational Behavior and Human Decision Processes, Elsevier, vol. 89(2), pages 1162-1175, November.
    9. Blumenschein, Karen & Johannesson, Magnus & Yokoyama, Krista K. & Freeman, Patricia R., 2001. "Hypothetical versus real willingness to pay in the health care sector: results from a field experiment," Journal of Health Economics, Elsevier, vol. 20(3), pages 441-457, May.
    10. Champ, Patricia A. & Bishop, Richard C. & Brown, Thomas C. & McCollum, Daniel W., 1997. "Using Donation Mechanisms to Value Nonuse Benefits from Public Goods," Journal of Environmental Economics and Management, Elsevier, vol. 33(2), pages 151-162, June.
    11. Camerer, Colin F & Hogarth, Robin M, 1999. "The Effects of Financial Incentives in Experiments: A Review and Capital-Labor-Production Framework," Journal of Risk and Uncertainty, Springer, vol. 19(1-3), pages 7-42, December.
    12. James Murphy & P. Allen & Thomas Stevens & Darryl Weatherhead, 2005. "A Meta-analysis of Hypothetical Bias in Stated Preference Valuation," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 30(3), pages 313-325, 03.
    13. John List & Craig Gallet, 2001. "What Experimental Protocol Influence Disparities Between Actual and Hypothetical Stated Values?," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 20(3), pages 241-254, November.
    14. Joseph Little & Robert Berrens, 2004. "Explaining Disparities between Actual and Hypothetical Stated Values: Further Investigation Using Meta-Analysis," Economics Bulletin, AccessEcon, vol. 3(6), pages 1-13.
    15. Peter A. Diamond & Jerry A. Hausman, 1994. "Contingent Valuation: Is Some Number Better than No Number?," Journal of Economic Perspectives, American Economic Association, vol. 8(4), pages 45-64, Fall.
    16. Johannesson, Magnus, et al, 1999. "Calibrating Hypothetical Willingness to Pay Responses," Journal of Risk and Uncertainty, Springer, vol. 18(1), pages 21-32, April.
    Full references (including those not matched with items on IDEAS)

    Citations

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:eee:joepsy:v:33:y:2012:i:5:p:963-972. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.