Guy Hochman

Losses as modulators of attention: Review and analysis of the unique effects of losses over gains.

It has been shown that in certain situations losses exert a stronger effect on behavior than respective gains, and this has been commonly explained by the argument that losses are given more weight in peoples decisions than respective gains. However, although much is understood about the effect of losses on cognitive processes and behavior, 2 major inconsistencies remain. First, recent empirical evidence fails to demonstrate that people avoid incentive structures that carry equivalent gains and losses. Second, findings in experience-based decision tasks indicate that following losses, increased arousal is observed simultaneously with no behavioral loss aversion. To account for these findings, we developed an attention-allocation model as a comprehensive framework for the effect of losses. According to this model losses increase on-task attention, thereby enhancing the sensitivity to the reinforcement structure. In the current article we examine whether this model can account for a broad range of empirical phenomena involving losses. We show that as predicted by the attentional model, asymmetric effects of losses on behavior emerge where gains and losses are presented separately but not concurrently. Yet, even in the absence of loss aversion, losses have distinct effects on performance, arousal, frontal cortical activation, and behavioral consistency. The attentional model of losses thus explains some of the main inconsistencies in previous studies of the effect of losses.

Loss-aversion or loss-attention: The impact of losses on cognitive performance

Losses were found to improve cognitive performance, and this has been commonly explained by increased weighting of losses compared to gains (i.e., loss aversion). We examine whether effects of losses on performance could be modulated by two alternative processes: an attentional effect leading to increased sensitivity to task incentives; and a contrast-related effect. Empirical data from five studies show that losses improve performance even when the enhanced performance runs counter to the predictions of loss aversion. In Study 1-3 we show that in various settings, when an advantageous option produces large gains and small losses, participants select this alternative at a higher rate than when it does not produce losses. Consistent with the joint influence of attention and contrast-related processes, this effect is smaller when a disadvantageous alternative produces the losses. In Studies 4 and 5 we find a positive effect on performance even with no contrast effects (when a similar loss is added to all alternatives). These findings indicate that both attention and contrast-based processes are implicated in the effect of losses on performance, and that a positive effect of losses on performance is not tantamount to loss aversion.

Processing differences between descriptions and experience: a comparative analysis using eye-tracking and physiological measures

Do decisions from description and from experience trigger different cognitive processes? We investigated this general question using cognitive modeling, eye-tracking, and physiological arousal measures. Three novel findings indeed suggest qualitatively different processes between the two types of decisions. First, comparative modeling indicates that evidence-accumulation models assuming averaging of all fixation-sampled outcomes predict choices best in decisions from experience, whereas Cumulative Prospect Theory predicts choices best in decisions from descriptions. Second, arousal decreased with increasing difference in expected value between gambles in description-based choices but not in experience. Third, the relation between attention and subjective weights given to outcomes was stronger for experience-based than for description-based tasks. Overall, our results indicate that processes in experience-based risky choice can be captured by sampling-and-averaging evidence-accumulation model. This model cannot be generalized to description-based decisions, in which more complex mechanisms are involved.

Loss Attention in a Dual-Task Setting

The positive effect of losses on performance has been explained as stemming from the increased weighting of losses relative to gains. We examine an alternative possibility whereby this effect is mediated by attentional processes. Using the dual-task paradigm, we expected that positive effects of losses on performance would emerge under attentional scarcity and diffuse to a concurrently presented task. In Study 1, decision performance was compared for a task that involved either gains or losses and was performed either alone or as a secondary task. The results showed a significant 40% improvement in performance in the loss condition, but only under conditions of resource scarcity, when the task was a secondary one. In Study 2, the same task was presented as a primary task. Again, losses were associated with improved performance in the secondary task. Given that this secondary task did not include losses, these findings demonstrate an attentional spillover effect.

It’s (Not) All About the Jacksons Testing Different Types of Short-Term Bonuses in the Field

The use of short-term bonuses to motivate employees has become an organizational regularity, but a thorough understanding of the relationship between these incentives and actual performance is lacking. We aim to advance this understanding by examining how three types of bonuses (cash, family meal voucher, and verbal reward) affect employees’ productivity in a field experiment conducted in a high-tech manufacturing factory. While all types of bonuses increased performance by over 5%, nonmonetary short-term bonuses had a slight advantage over monetary bonuses. In addition, the removal of the bonuses led to decreased productivity for monetary bonuses but not for the verbal reward. However, this negative effect of monetary short-term bonuses diminishes when a cash bonus is chosen by employees rather than granted by default. Theoretical implications about the effect of short-term bonuses on intrinsic motivation and reciprocity, as well as practical applications of short-term bonus plans that stem from our findings, are discussed.

Robot Presence and Human Honesty: Experimental Evidence

Robots are predicted to serve in environments in which human honesty is important, such as the workplace, schools, and public institutions. Can the presence of a robot facilitate honest behavior? In this paper, we describe an experimental study evaluating the effects of robot social presence on people’s honesty. Participants completed a perceptual task, which is structured so as to allowthem to earn more money by not complying with the experiment instructions. We compare three conditions between subjects: Completing the task alone in a room; completing it with a non-monitoring human present; and completing it with a non-monitoring robot present. The robot is a new expressive social head capable of 4-DoF head movement and screen-based eye animation, specifically designed and built for this research. It was designed to convey social presence, but not monitoring. We find that people cheat in all three conditions, but cheat equally less when there is a human or a robot in the room, compared to when they are alone. We did not find differences in the perceived authority of the human and the robot, but did find that people felt significantly less guilty after cheating inthe presence of a robot as compared to a human. This has implications for the use of robots in monitoring and supervising tasks in environments in which honesty is key. Categories and Subject Descriptors H.1.2 [Models and Principles]: User/Machine Systems; J.4 [Computer Applications]: Social and Behavioral Sciences–- psychology. General Terms Experimentation, Human Factors.

The partial-reinforcement extinction effect and the contingent-sampling hypothesis

The partial-reinforcement extinction effect (PREE) implies that learning under partial reinforcements is more robust than learning under full reinforcements. While the advantages of partial reinforcements have been well-documented in laboratory studies, field research has failed to support this prediction. In the present study, we aimed to clarify this pattern. Experiment 1 showed that partial reinforcements increase the tendency to select the promoted option during extinction; however, this effect is much smaller than the negative effect of partial reinforcements on the tendency to select the promoted option during the training phase. Experiment 2 demonstrated that the overall effect of partial reinforcements varies inversely with the attractiveness of the alternative to the promoted behavior: The overall effect is negative when the alternative is relatively attractive, and positive when the alternative is relatively unattractive. These results can be captured with a contingent-sampling model assuming that people select options that provided the best payoff in similar past experiences. The best fit was obtained under the assumption that similarity is defined by the sequence of the last four outcomes.

Recency gets larger as lesions move from anterior to posterior locations within the ventromedial prefrontal cortex.

In the past two decades neuroimaging research has substantiated the important role of the prefrontal cortex (PFC) in decision-making. In the current study, we use the complementary lesion based approach to deepen our knowledge concerning the specific cognitive mechanisms modulated by prefrontal activity. Specifically, we assessed the brain substrates implicated in two decision making dimensions in a sample of prefrontal cortex patients: (a) the tendency to differently weigh recent compared to past experience; and (b) the tendency to differently weigh gains compared to losses. The participants performed the Iowa Gambling Task, a complex experience-based decision-making task, which was analyzed with a formal cognitive model (the Expectancy-Valance model). The results indicated that decisions become influenced by more recent, as opposed to older, events when the damage reaches the posterior sectors of the ventromedial prefrontal cortex (VMPC). Furthermore, the degree of this recency deficit was related to the size of the lesion. These results suggest that the posterior area of the prefrontal cortex directly modulates the capacity to use time-delayed information. In contrast, we did not find similar modulation for the sensitivity to gains versus losses.

Fairness requires deliberation: the primacy of economic over social considerations

While both economic and social considerations of fairness and equity play an important role in financial decision-making, it is not clear which of these two motives is more primal and immediate and which one is secondary and slow. Here we used variants of the ultimatum game to examine this question. Experiment 1 shows that acceptance rate of unfair offers increases when participants are asked to base their choice on their gut-feelings, as compared to when they thoroughly consider the available information. In line with these results, Experiments 2 and 3 provide process evidence that individuals prefer to first examine economic information about their own utility rather than social information about equity and fairness, even at the price of foregoing such social information. Our results suggest that people are more economically rational at the core, but social considerations (e.g., inequality aversion) require deliberation, which under certain conditions override their self-interested impulses.

Determinants of judgment and decision making quality: the interplay between information processing style and situational factors.

A framework is presented to better characterize the role of individual differences in information processing style and their interplay with contextual factors in determining decision making quality. In Experiment 1, we show that individual differences in information processing style are flexible and can be modified by situational factors. Specifically, a situational manipulation that induced an analytical mode of thought improved decision quality. In Experiment 2, we show that this improvement in decision quality is highly contingent on the compatibility between the dominant thinking mode and the nature of the task. That is, encouraging an intuitive mode of thought led to better performance on an intuitive task but hampered performance on an analytical task. The reverse pattern was obtained when an analytical mode of thought was encouraged. We discuss the implications of these results for the assessment of decision making competence, and suggest practical directions to help individuals better adjust their information processing style to the situation at hand and make optimal decisions.