Satisfaction in choice as a function of the number of alternatives: When "goods satiate" but "bads escalate"

Whereas people are typically thought to be better off with more choices, studies show that they often prefer to choose from small as opposed to large sets of alternatives. We propose that satisfaction from choice is an inverted U-shaped function of the number of alternatives. This proposition is derived theoretically by considering the benefits and costs of different numbers of alternatives and is supported by four experimental studies. We also manipulate the perceptual costs of information processing and demonstrate how this affects the resulting “satisfaction function.” We further indicate that satisfaction when choosing from a given set is diminished if people are made aware of the existence of other choice sets. The role of individual differences in satisfaction from choice is documented by noting effects due to gender and culture. We conclude by emphasizing the need to have an explicit rationale for knowing how much choice is “enough.”Consumer choice, perception of variety, tyranny of choice, visual perception, cultural differences, Leex

Choice overload reduces neural signatures of choice set value in dorsal striatum and anterior cingulate cortex

Modern societies offer a large variety of choices, which is generally thought to be valuable. But having too much choice can be detrimental if the costs of choice outweigh its benefits due to ‘choice overload’. Current explanatory models of choice overload mainly derive from behavioural studies. A neuroscientific investigation could further inform these models by revealing the covert mental processes during decision-making. We explored choice overload using functional magnetic resonance imaging while subjects were either choosing from varying-sized choice sets or were browsing them. When choosing from sets of 6, 12 or 24 items, functional magnetic resonance imaging activity in the striatum and anterior cingulate cortex resembled an inverted U-shaped function of choice set size. Activity was highest for 12-item sets, which were perceived as having ‘the right amount’ of options and was lower for 6-item and 24-item sets, which were perceived as ‘too small’ and ‘too large’, respectively. Enhancing choice set value by adding a dominant option led to an overall increase of activity. When subjects were browsing, the decision costs were diminished and the inverted U-shaped activity patterns vanished. Activity in the striatum and anterior cingulate reflects choice set value and can serve as neural indicator of choice overload

Price-denomination effect: Choosing to pay with denominations that are the same as the product prices

Building on past research on judgment anchoring, we investigate the effect of price information on consumers’ choice of denomination when making a purchase. Across seven experiments, including two in the field (N = 4,020), we find that people tend to purchase with denominations that are the same as the product prices. They use larger denominations for higher priced products that are priced at the value of the denomination held, and smaller denominations for lower priced products that are priced at the value of the smaller denomination held. The effect is not explained by storage or purchase convenience. We propose the “price-denomination effect” is driven by consumers anchoring on product price and then choosing the denomination that matches the anchor. The effect replicates across participants from different continents (United States, Europe, and Africa) and samples (online panelists, and actual consumers), as well as prices in different currencies (United States $, €, and Nigerian Naira). We further demonstrate that people’s preference for denominations also affects the choice of the form of payment used: cash versus card. Consumers are more likely to use cash (vs. card) when product price is exactly the same as a denomination held. We conclude with a discussion of theoretical and practical implications

Choice overload reduces neural signatures of choice set value in dorsal striatum and anterior cingulate cortex

Modern societies offer a large variety of choices, which is generally thought to be valuable. But having too much choice can be detrimental if the costs of choice outweigh its benefits due to ‘choice overload’. Current explanatory models of choice overload mainly derive from behavioural studies. A neuroscientific investigation could further inform these models by revealing the covert mental processes during decision-making. We explored choice overload using functional magnetic resonance imaging while subjects were either choosing from varying-sized choice sets or were browsing them. When choosing from sets of 6, 12 or 24 items, functional magnetic resonance imaging activity in the striatum and anterior cingulate cortex resembled an inverted U-shaped function of choice set size. Activity was highest for 12-item sets, which were perceived as having ‘the right amount’ of options and was lower for 6-item and 24-item sets, which were perceived as ‘too small’ and ‘too large’, respectively. Enhancing choice set value by adding a dominant option led to an overall increase of activity. When subjects were browsing, the decision costs were diminished and the inverted U-shaped activity patterns vanished. Activity in the striatum and anterior cingulate reflects choice set value and can serve as neural indicator of choice overload

Experiments on the role of the number of alternatives in choice

Whereas people are typically thought to be better off with more choices, large sets may lead to "choice paralysis". This thesis explores the processes underlying the choice from multiple alternatives in different settings. First, we propose that satisfaction is an inverted U-shaped function of the number of alternatives. This proposition is derived theoretically by considering the benefits and costs of different numbers of alternatives, and validated empirically. Second, we investigate the computational processes used to make choices from multiple alternatives under extreme time pressure using an eye-tracking technique. We find that choices are well-described by a sequential search model, in which people randomly fixate on items, measure their values, and choose the best item seen. Third, we study the neural bases of choice from multiple alternatives using fMRI. The results demonstrate that brain activity is modulated by the number of choice items and by the subjective choice experience of people.Comúnmente, se piensa que es mejor para la gente tener más alternativas de elección. Sin embargo, grandes conjuntos pueden llevar a una "parálisis de elección". Esta tesis explora los procesos que guían la elección entre múltiples alternativas. Primero, proponemos teóricamente que la satisfacción, en función del número de alternativas (considerando los beneficios y costes de este) adopta una forma de U-invertida. Luego, lo comprobamos empíricamente. Segundo, investigamos los procesos utilizados para elegir entre múltiples alternativas, bajo extrema presión de tiempo, utilizando "eye-tracking". Encontramos que las elecciones son bien descritas por un modelo de búsqueda secuencial en el que la gente se fija en los artículos, mide sus valores y escoge el mejor visto. Tercero, estudiamos los fundamentos neuronales de elección de múltiples alternativas usando fMRI. Los resultados muestran que la actividad cerebral es modulada por el número de productos a elegir y por la experiencia subjetiva de elección

It's not necessarily best to be first

People are less likely to choose the highest-rated option in a quality ranking if it appears first on the lis

Satisfaction in choice as a function of the number of alternatives: When "goods satiate" but "bads escalate"

People often prefer to choose from small as opposed to large sets of alternatives. We propose that satisfaction from choice is an inverted U-shaped function of the number of alternatives. This proposition is derived theoretically by considering the benefits and costs of different numbers of alternatives and is supported by three experimental studies. Because, in large sets, the perceptual costs of processing alternatives varying in shape are greater than for alternatives varying in color, we also predict and demonstrate greater satisfaction from choosing from the latter. We further show that the "satisfaction function" is affected by gender and cultural background