Why You’ll Never See a Comma at Best Buy

When it’s time to make an important purchase there are ways to ensure you don’t get screwed. You could talk to your friend who’s an industry insider, spend days scanning various websites for good deals, or simply go to the store and attempt to bargain. Nevertheless, in the end the people doing the selling will always be three steps ahead because they’re on top of research like this:

In this paper, we demonstrate that including commas (e.g., $1599 vs. $1599) and cents (e.g., $1599.85 vs. $1599) in a price’s Arabic written form (i.e., how it is perceived visually) can change how the price is encoded and represented verbally in a consumer’s memory. In turn, the verbal encoding of a written price can influence assessments of the numerical magnitude of the price. These effects occur because consumers non-consciously perceive that there is a positive relationship between syllabic length and numerical magnitude.

More specifically, the study found that when a price includes a comma (e.g. $1,426 rather than $1426), people are likely to pronounce it “fourteen-hundred and twenty-six” rather than “fourteen-twenty-six.” Because there are more words, more auditory processing time is needed, and the increased processing time creates the perception that the magnitude of the price is greater. The same effect occurred when cents were added to a price (e.g. $1426.85 was perceived to be of a significantly higher magnitude than $1,426).

Although you can be sure every major retailer is aware of these effects, the nice thing about the study is that its ideas can be applied by almost anybody. Ameliorate your girlfriend’s anger by saying the lamp you broke cost $20 rather than $21.99. Show your friend you’re a bigshot by writing that your new car cost $18,457.89 rather than $18457. You could even fight SOPA by adding commas to public lists that show the number of companies the law will destroy. (Ok, that’s probably not the most-efficient way to fight the bill, but you get the idea. )
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Coulter, K., Choi, P., & Monroe, K. (2011). Comma N’ cents in pricing: The effects of auditory representation encoding on price magnitude perceptions Journal of Consumer Psychology DOI: 10.1016/j.jcps.2011.11.005

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Progressive Taxation Makes People Happier

There’s a common response the Occupy movement that goes something along the lines of “well, you can complain about the rich, but raising their taxes won’t solve your problems.” From a psychology standpoint, it appears to be a good response. Most of the time you don’t feel better about life because of something that happens to somebody else. However, in this instance that doesn’t appear to be the case because there is comprehensive correlational evidence that progressive taxation does make people happier.

Consistent with Rawls’s theory of justice, our results showed that progressive taxation was positively associated with the subjective well-being of nations. However, the overall tax rate and government spending were not associated with the subjective well-being of nations. Furthermore, controlling for the wealth of nations and income inequality, we found that respondents living in a nation with more-progressive taxation evaluated their lives as closer to the best possible life and reported having more positive and less negative daily experiences than did respondents living in a nation with less- progressive taxation.

It’s still unclear what causes this relationship, but there is both survey and experimental evidence pointing to the fact that inequality decreases trust. Less trust isn’t quite the same as more anxiety and fear (and thus less happiness), but the two outcomes are on the same spectrum.

On another note, if Mitt Romney happens to be feeling comfortable right now the above inequality-trust paper has a finding that should keep him up at night.

We find that there are less trusting behaviours when subjects know the income endowments of their co-players.

In other words, specific known instances of inequality lead to the most mistrust. Perhaps Romney should be publicly hanging out with people richer than himself so he can appear to be a victim of inequality.
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Oishi, S., Schimmack, U., & Diener, E. (2011). Progressive Taxation and the Subjective Well-Being of Nations Psychological Science DOI: 10.1177/0956797611420882

Hargreaves Heap, S., Tan, J., & Zizzo, D. (2011). Trust, inequality and the market Theory and Decision DOI: 10.1007/s11238-011-9287-y

How the Concept of “God” Influences Goal Pursuit

Does thinking about god help you in life? It’s a question whose answer will likely never be accepted by many, but that hasn’t stopped researchers from trying to find it. A new study examining self-regulation reveals that thinking about god does help you achieve your goal, but only if your goal is to successfully resist the urge to do something.

Leveraging classic and recent theorizing on self-regulation and social cognition, we predict and test for 2 divergent effects of exposure to notions of God on self-regulatory processes. Specifically, we show that participants reminded of God (vs. neutral or positive concepts) demonstrate both decreased active goal pursuit (Studies 1, 2, and 5) and increased temptation resistance (Studies 3, 4, and 5).

The researchers believe the findings are due to god’s reputation for omnipotence and omniscience. If god is always watching, you better not do that bad thing, but if god controls everything, it’s less important to fervently pursue your goals. The neat thing about the study is that because the self-regulation patterns exhibited by subjects in the experiment were independent of existing religiosity, it means that the less-religious or agnostic may be influenced by the concept of god as much as a somebody devout.

From an evolutionary standpoint, the idea that God helps you resist temptation while decreasing your pursuit of other goals makes a lot of sense. Throughout most of history it’s been more beneficial for survival to resist temptation (e.g. not breaking the law when ruled by a king, avoiding the shortcut through the dangerous part of the forest, etc.) than to actively pursue a goal (e.g. working hard at your merchant business). What’s interesting is that the trend is now starting to reverse. We live in a world that’s safer than ever, and globalization means that those who single-mindedly pursue a goal and succeed on a global level will reap untold rewards. Even those who succumb to the dangerous temptation of eating unhealthy can fix many of those problems with money made from strong goal pursuit.

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Laurin, K., Kay, A., & Fitzsimons, G. (2012). Divergent effects of activating thoughts of God on self-regulation. Journal of Personality and Social Psychology, 102 (1), 4-21 DOI: 10.1037/a0025971

78% of North Koreans Think I’m Right

Do you know anybody who’s a Rick Santorum supporter? Is he/she obnoxiously confident the polls will move in Santorum’s direction once his message spreads? That soon nothing will stop him from ensuring society once again has values? If you do, don’t look down on them because they have a comically unrealistic sense of the political landscape, simply look down on them because they’ve fallen victim to the psychological tendency to assume people you know nothing about agree with you.

In two field studies, we examined whether voters overestimate support for their political party among nonvoters. In Study 1, voters estimated the percentage of votes their party would receive in an upcoming election, and this percentage increased when voters estimated the percentage of votes their party would receive if nonvoters also were to vote. In Study 2, participants overestimated support for their party even when we made them explicitly aware of current levels of this support by presenting them with poll-based forecasts of election results.

If I could pick one thing on which to blame all the problems in the world, it would be our psychological need to buttress our own beliefs. The assumption that strangers agree with you is one way to do this, but there are many others (motivated reasoning, confirmation bias, etc.). Although the unconscious bolstering of your positions seems harmless and even smart — less doubt does lead to less unhappiness — constantly reinforcing your beliefs makes it very hard to change your mind when you’re wrong. The emergent outcome of a population slow to correct mistakes is a world where too many people are wrong about important things.

On a somewhat related note, an interesting little exercise is to respond “I think you’re wrong” anytime somebody shares an opinion. Most of the time the person presses for an explanation and then you can say you were just joking, but you’d be surprised how often people instantly qualify their position. They won’t actually change their opinion, but they’ll modify it so it’s more likely to be “right” (and probably without any internal acknowledgment that part of their previous position was wrong.) I also recommend responding to opinions by pointing to a stranger across the street and declaring that he disagrees. Whatever it is that makes you or others think more deeply about why you think what you think, it’s probably a good idea.
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Koudenburg, N., Postmes, T., & Gordijn, E. (2011). If They Were to Vote, They Would Vote for Us Psychological Science, 22 (12), 1506-1510 DOI: 10.1177/0956797611420164

Rich People Hate Debt, Poor People Hate Not Having Stuff

Nearly everybody has taken some blame for the slow economy — Democrats, Republicans, Goldman Sachs, Freddie Mac, Easy Mac, EasyJet, Benny and the Jets, etc.  Human psychology is also a big culprit, and a new study by two Princeton researchers on perceptions of wealth adds another reason why our brains are to blame.

The researchers asked subjects for their impressions of the financial situations of fictional people who had the same net worth but different levels of debt and assets. For example, subjects might be told about two people with a net worth of -$24,000, with one person having $12,000 in assets and $36,000 in debt, and the other person having $40,000 in assets and $64,000 in debt. Subjects were asked about groups that had both positive and negative net worth.

What the researchers found was that people with positive net worth felt and were seen as wealthier when they had less debt, even if they had a correspondingly smaller number of assets. Conversely, people with negative net worth felt and were seen as wealthier when they had more assets, even if they had a correspondingly larger amount of debt. In other words, if your overall net worth is negative and you want to feel better about your financial situation, the best course of action isn’t to pay down your debt, it’s to take out another loan and buy more stuff. Can you say “credit bubble”?

Perhaps the most depressing part is that this happens despite market forces encouraging the opposite.

People in the red would likely face higher interest-rate debt and lower-return investment opportunities, which make additional debt financially unappealing, whereas those in the black would have access to lower interest rates and better investments, which might encourage additional debt. Instead, we found the opposite pattern.

If you think about it, the results of the study are somewhat intuitive. You may have a hard time feeling wealthier than your neighbor because your mansion has one more bedroom, but if your neighbor is still paying off  loans from his son’s MFA degree it’s easy to claim your status is higher. Similarly, when people are already in the red adding more debt doesn’t jump out as a big deal, but having a new car may seem like a big step up. Perhaps if the world was like that mutual fund commercial where people have their debt publicly displayed in bubbles hovering over their heads things would be different, unfortunately, the technology isn’t there yet.

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Sussman, A., & Shafir, E. (2011). On Assets and Debt in the Psychology of Perceived Wealth Psychological Science DOI: 10.1177/0956797611421484

What Attracts Us to Power?

Uncle Ben may have seemed like an over-zealous advice-giving old kook when he harped to Spiderman that “with great power comes great responsibility,” but now there is some science hinting at the wisdom of his words. According to a new study, people are much more attracted to power when they construe it as opportunity rather than responsibility.

Four studies manipulated the construal of power by means of a mindset priming manipulation: participants that put themselves in a high power role judged the same twelve measures either in terms of their contribution to the success or whether they are ethically responsible. This minimal manipulation influenced the attraction of power – in all four studies participants were more attracted to power when construed as opportunity than when construed as responsibility.

If power is more attractive when construed as opportunity, those who eventually seize it are more likely to be focused on opportunity. Thus Uncle Ben was wise to stress the importance of also focusing on the responsibility aspect of power (although you could question his decision to only share this wisdom with his seemingly powerless loser nephew.)

Unfortunately, there is no emphasis on responsibility the U.S. political system (I think the mantra is “with great power comes…great power”) and the increased focus on opportunity creates a destructive cycle. Because those who construe power as opportunity are more attracted to it, they are more likely to get it. They then use their power for opportunity (building a personal brand, attempting to get more power, etc.) rather than responsibility (protecting civil liberties, helping those in need, etc). The presence of powerful people focused on opportunity makes it easier for others to construe power as opportunity, and the cycle continues until the population of those in power skews towards people who are concerned with opportunity rather than responsibility. Eventually the political system is packed with self-interest. And by eventually, I mean eleven years ago.
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Sassenberg, K. (2011). The attraction of social power: The influence of construing power as opportunity versus responsibility Journal of Experimental Social Psychology DOI: 10.1016/j.jesp.2011.11.008

What’s the Best Way to Flatter Someone?

How much do you think I get paid? What do you think I got on the SAT? How long do you think I’ve been practicing piano? Everyday people are faced with numerous questions for which they just want to give the answer that will make the other person feel the best. The question is, how do you know what that answer is?

Most research suggests that you should guess something big because “overguessing” will show the person you think highly of them. However, it turns out overguessing is not always the best strategy. A study published in this month’s issue of Emotion finds that when recently employed college graduates hear guesses about their earnings they feel better when the guesses are low rather than high. The same outcome emerged in a follow up study that used GMAT scores instead of salaries.

The researchers propose a clever model to account for the varying preferences for overguessing and underguessing:

In situations where people either do not know the truth or care about others’ impression, overguesses suggest favorable prospects or impressions and hence make people happy. In situations where people already know the truth and care about it more than about others’ impression of it, underguesses make the truth look more attractive and hence make people happy. In both situations, people feel happy about what enhances the self, but the route to enhancement differs between these situations.

For example, if I have not yet been hired, I’ll feel better if you guess I’ll have a high salary because it raises my opinion of myself and my prospects. Similarly, if I’ve already been hired and I’m mostly concerned with people thinking I’m a bigshot, I’ll also be happiest if you guess I have a high salary. However, my preference will change when I care more about the truth than your impression of me. In this situation if you estimate I have a low salary I’ll feel better because I get satisfaction from knowing I make more money than I “should.”

So what do you say when you’re in a job interview and your future boss asks you how much annual revenue you think the company has? If you think he’s concerned with people having a good impression of the company, throwing out a high number will make him happiest. However, if you think he doesn’t care about impressions you’ll make him happiest by throwing out a low number that makes the truth (i.e. the company’s actual revenue) appear extremely attractive. Of course if he wants to see that you know about the company instead of using the interview to increase his positive affect, it’s probably best to give the correct answer.
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Shen, L., Hsee, C., Zhang, J., & Dai, X. (2011). The art and science of guessing. Emotion, 11 (6), 1462-1468 DOI: 10.1037/a0022899