Eric J. Johnson

Adaptive Strategy Selection in Decision Making.

Abstract : The authors examine the role of effort and accuracy in the adaptive use of decision processes. A computer simulation study that used the concept of elementary information processes identified heuristic choice strategies which approximate the accuracy of normative procedures while requiring substantially less effort. However, no single heuristic did well across all task and context conditions. Of particular interest was the finding that under time constraints, several heuristics were clearly more accurate than a normative procedure. Two process tracing studies showed a significant degree of correspondence between the efficient strategies for a given decision problem identified by the simulation and actual decision behavior. People were highly adaptive to changes in the nature of the alternatives available to them and to the presence of time pressure. (Author)

Predictors of online buying behavior

Consumers worldwide can shop online 24 hours a day, seven days a week, 365 days a year. Some market sectors, including insurance, financial services, computer hardware and software, travel, books, music, video, flowers, and automobiles, are experiencing rapid growth in online sales. For example, in Jan. 1999, Dell Computer Corp. was selling an average of

The validity of verbal protocols

14 million of equipment online per day, and Amazon.com has become the third largest bookseller in the U.S., despite being in business only since 1995. With projections that the Internet will generate consumer and business-to-business sales in excess of

Can Consumers Make Affordable Care Affordable? The Value of Choice Architecture

294 billion by 2002, online retailing raises many questions about how to market on the Net.

A componential analysis of cognitive effort in choice

The reactivity of a “think aloud” verbal protocol and the veridicality of different retrospective protocols were tested over four dissimilar tasks. Generating a concurrent protocol altered accuracy in two tasks, simple addition and a choice between two gambles, and generally prolonged response times. Such reactivity partially qualifies the dominant theory of protocol generation (Ericsson & Simon, 1984). Retrospective protocols yielded substantial forgetting or fabrication in all tasks, supporting the consensus on the nonveridicality of these methods. It is concluded that protocol validity should be based on an empirical check rather than on theory-based assurances.

When Web Pages Influence Choice: Effects of Visual Primes on Experts and Novices

Tens of millions of people are currently choosing health coverage on a state or federal health insurance exchange as part of the Patient Protection and Affordable Care Act. We examine how well people make these choices, how well they think they do, and what can be done to improve these choices. We conducted 6 experiments asking people to choose the most cost-effective policy using websites modeled on current exchanges. Our results suggest there is significant room for improvement. Without interventions, respondents perform at near chance levels and show a significant bias, overweighting out-of-pocket expenses and deductibles. Financial incentives do not improve performance, and decision-makers do not realize that they are performing poorly. However, performance can be improved quite markedly by providing calculation aids, and by choosing a “smart” default. Implementing these psychologically based principles could save purchasers of policies and taxpayers approximately 10 billion dollars every year.

Consumer buying behavior on the Internet: Findings from panel data

Abstract We examine the effort required to execute decision strategies and propose a set of elementary information processes (EIPs) (e.g., reads, additions, comparisons) as a common language for describing these strategies. Based upon these component processes, a model for measuring the effort required to execute a decision strategy is proposed which suggests that effort is a weighted sum of EIPs. We test several variants of this model by attempting to predict decision latencies and subjective reports of effort. The proposed weighted EIP model provides good predictions for response time and subjective effort, and estimates of the time and effort associated with each EIP seem plausible and consistent with those found in other cognitive tasks. The time and effort required by each EIP do not vary substantially across rules; however, there are significant individual differences. On balance, the EIP approach to conceptualizing and measuring the effort of executing a choice strategy receives strong support.

Lateral prefrontal cortex and self-control in intertemporal choice.

This article extends the idea that priming can influence preferences by making selected attributes focal. Our on-line experiments manipulate the background pictures and colors of a Web page, affecting consumer product choice. We demonstrate that these effects occur for both experts and novices, albeit by different mechanisms. For novices, priming drives differences in external search that, in turn, drive differences in choice. For experts, we observe differences in choice that are not mediated by changes in external search. These findings confirmed that on-line atmospherics in electronic environments could have a significant influence on consumer choice.

Does Measuring Intent Change Behavior

Presents the findings from a panel data on consumer buying behavior on the Internet. Advantages and disadvantages of panel data for survey research; Demographics of online consumers; Dollar amount that consumers are spending online; Total online spending projections in the United States.

Cognitive Lock-In and the Power Law of Practice

Disruption of function of left, but not right, lateral prefrontal cortex (LPFC) with low-frequency repetitive transcranial magnetic stimulation (rTMS) increased choices of immediate rewards over larger delayed rewards. rTMS did not change choices involving only delayed rewards or valuation judgments of immediate and delayed rewards, providing causal evidence for a neural lateral-prefrontal cortex–based self-control mechanism in intertemporal choice.