Criteria instability and the isolated option effect

In two-stage choices, decision makers often compare a new (isolated) option with the winner from the first stage. Previous research has identified a choice advantage for an isolated option, ostensibly due to loss aversion. We propose an alternative mechanism suggesting that instability of the criter...

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Bibliographic Details
Published in:Organizational behavior and human decision processes 2008-07, Vol.106 (2), p.153-167
Main Authors: Palmeira, Mauricio M., Krishnan, H. Shanker
Format: Article
Language:English
Subjects:
Biological and medical sciences
Choice
Cognition. Intelligence
Comparative analysis
Decision making
Decision making. Choice
Decision models
Decision theory
Economic psychology
Fundamental and applied biological sciences. Psychology
Isolated option effect
Multiple criteria decision making
Options
Psychology. Psychoanalysis. Psychiatry
Psychology. Psychophysiology
Random component
Sequential choice
Studies
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Summary:In two-stage choices, decision makers often compare a new (isolated) option with the winner from the first stage. Previous research has identified a choice advantage for an isolated option, ostensibly due to loss aversion. We propose an alternative mechanism suggesting that instability of the criteria used in each choice stage is the main driver of the isolated option effect. Results from a series of experiments support the criteria instability account and not loss aversion as the explanation for the isolated option effect.
ISSN:0749-5978
1095-9920
DOI:10.1016/j.obhdp.2007.12.001