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The effect of incomplete information on the compromise effect

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  • Shih-Chieh Chuang
  • Danny Tengti Kao
  • Yin-Hui Cheng
  • Chu-An Chou
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    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.

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    Bibliographic Info

    Article provided by Society for Judgment and Decision Making in its journal Judgment and Decision Making.

    Volume (Year): 7 (2012)
    Issue (Month): 2 (March)
    Pages: 196-204

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    Handle: RePEc:jdm:journl:v:7:y:2012:i:2:p:196-204

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    Related research

    Keywords: compromise effect; incomplete information; uncertainty; inference; no-choice.;

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    1. Dhar, Ravi, 1997. " Consumer Preference for a No-Choice Option," Journal of Consumer Research, University of Chicago Press, vol. 24(2), pages 215-31, September.
    2. Simmons, Carolyn J & Lynch, John G, Jr, 1991. " Inference Effects without Inference Making? Effects of Missing Information on Discounting and Use of Presented Information," Journal of Consumer Research, University of Chicago Press, vol. 17(4), pages 477-91, March.
    3. Amos Tversky & Itamar Simonson, 1993. "Context-Dependent Preferences," Management Science, INFORMS, vol. 39(10), pages 1179-1189, October.
    4. Simonson, Itamar, 1989. " Choice Based on Reasons: The Case of Attraction and Compromise Effects," Journal of Consumer Research, University of Chicago Press, vol. 16(2), pages 158-74, September.
    5. Coupey, Eloise & Irwin, Julie R & Payne, John W, 1998. " Product Category Familiarity and Preference Construction," Journal of Consumer Research, University of Chicago Press, vol. 24(4), pages 459-68, March.
    6. Greenleaf, Eric A & Lehmann, Donald R, 1995. " Reasons for Substantial Delay in Consumer Decision Making," Journal of Consumer Research, University of Chicago Press, vol. 22(2), pages 186-99, September.
    7. Ross, William T, Jr & Creyer, Elizabeth H, 1992. " Making Inferences about Missing Information: The Effects of Existing Information," Journal of Consumer Research, University of Chicago Press, vol. 19(1), pages 14-25, June.
    8. Simonson, Itamar & Kivetz, Ran, 2000. "The Effects of Incomplete Information on Consumer Choice," Research Papers 1609, Stanford University, Graduate School of Business.
    9. Briley, Donnel A & Morris, Michael W & Simonson, Itamar, 2000. " Reasons as Carriers of Culture: Dynamic versus Dispositional Models of Cultural Influence on Decision Making," Journal of Consumer Research, University of Chicago Press, vol. 27(2), pages 157-78, September.
    10. Lynch, John G, Jr & Srull, Thomas K, 1982. " Memory and Attentional Factors in Consumer Choice: Concepts and Research Methods," Journal of Consumer Research, University of Chicago Press, vol. 9(1), pages 18-37, June.
    11. Dowling, Grahame R & Staelin, Richard, 1994. " A Model of Perceived Risk and Intended Risk-Handling Activity," Journal of Consumer Research, University of Chicago Press, vol. 21(1), pages 119-34, June.
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