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On the Heritability of Choice, Judgment, and "Irrationality": Genetic Effects on Prudence and Constructive Predispositions

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  • Simonson, Itamar

    (Stanford University)

  • Sela, Aner

    (Stanford University)

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    Abstract

    Despite the very long history of research on heritable traits, we still know very little about genetic effects on judgment and choice, including consumer decision making. Building on recent advances in epigenetics, we hypothesize that people inherit a general prudence tendency, which affects their predisposition to choose options that vary on the prudence dimension. We use a classic twins study design whereby greater similarity between monozygotic twins than between dizygotic twins indicates a heritable trait. Unlike most prior studies that have focused on one or few characteristics, our study examines a broad range of judgment and choice phenomena simultaneously in order to gain insights into heritable tendencies (representing individual differences) and nonheritable tendencies. Consistent with our "prudence hypothesis," we find a significant heritable effect on (a) preferences for compromise (but not perceptually dominating) options, (b) choosing a sure gain over a gamble, (c) preferences for a feasible though dull assignment (in the near distance), (d) maximizing (versus satisficing), and (e) preferences for utilitarian (versus hedonic) options. Conversely, non-prudence problems (e.g., relating to discounting, highlighting, variety) as well as judgment heuristics (availability, representativeness, anchoring) do not appear to reflect heritable individual differences. We discuss the implications of our research with respect to the determinants of preferences, the interpretation of rationality and of BDT effects, the notion of constructive predispositions, and directions for future research regarding the role of genetics in decision making.

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    Bibliographic Info

    Paper provided by Stanford University, Graduate School of Business in its series Research Papers with number 2029.

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    Date of creation: Jul 2009
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    Handle: RePEc:ecl:stabus:2029

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    1. David, Cesarini & Dawes, Christopher T. & Johannesson, Magnus & Lichtenstein, Paul & Wallace, Björn, 2007. "Genetic Variation in Preferences for Giving and Risk-Taking," Working Paper Series in Economics and Finance 679, Stockholm School of Economics, revised 12 Jan 2009.
    2. 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.
    3. Simonson, Itamar & Nowlis, Stephen M, 2000. " The Role of Explanations and Need for Uniqueness in Consumer Decision Making: Unconventional Choices Based on Reasons," Journal of Consumer Research, University of Chicago Press, vol. 27(1), pages 49-68, June.
    4. Kivetz, Ran & Simonson, Itamar, 2002. " Self-Control for the Righteous: Toward a Theory of Precommitment to Indulgence," Journal of Consumer Research, University of Chicago Press, vol. 29(2), pages 199-217, September.
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