Less-is-better effect: when you prefer “less” rather than “more”
How evaluating situation separately can lead you to counterintuitive choices
A person giving a €45 scarf as a gift is perceived to be more generous than one giving a €55 coat?
Would you prefer an overfilled ice cream up with 7oz of ice cream or an underfilled cup served with 8oz of ice cream?
A person giving a €45 scarf as a gift is perceived to be more generous than one giving a €55 coat?
Would you prefer an overfilled ice cream up with 7oz of ice cream or an underfilled cup served with 8oz of ice cream?
These questions are related to a particular cognitive effect called “Less-is-better effect”. This effect has been mainly studied by Cristopher Hsee. In his article, the scholar suggested that the less-is-better effect occurred when two options were evaluated separately, and reversed itself when the options were juxtaposed. These results are explained in terms of the Evaluability hypothesis.
Let’s do this in an orderly fashion.
The evaluability hypothesis argues that separate evaluations of objects are often influenced by attributes which are east to evaluate rather than by those which are important.
The evaluability hypothesis argues that separate evaluations of objects are often influenced by attributes which are east to evaluate rather than by those which are important. Hsee suggested to think about the scarf/coat example. Suppose that you give each of two friends a gift: they have similar tastes, they don’t know what gift the other receives and one gift is more expensive than the other one.
Is it possible that the friend that receives the less expensive gift considers you more generous than the friend receiving the more expensive gift? In the economic theory, the normative decision theory suggests that people have consistent and well defined preferences regardless of how preferences are elicited, while behavioral decision research suggests that preferences are constructed ad hoc and can be influenced by the framing of a problem, the framing of a task, the display of information etc.
Scholars suggested that athletes who have just won the silver medal result less happy than athletes who have just won the bronze medal.
In the coat example, one may argue that the €45 scarf may be more useful and therefore more valuable than a €55 coat. However, it is important to underline that in our example the dependent variable was the generosity of the gift giver, not the usefulness of the gift. Yet, the result according to Hsee contradicted this intuition, and it is in the sense that it constituted a less-is-better effect.
Is it better for a gift giver, in order to be perceived as generous, to give a high value item from a low value product category (the €45 scarf) or to give a low value item from a high value product category (the €55 coat)?
Is it better for a gift giver, in order to be perceived as generous, to give a high value item from a low value product category (the €45 scarf) or to give a low value item from a high value product category (the €55 coat)?
Hsee has showed that, under particular circumstances, the first hypothesis wins. The less-is-better effect can be explained by evaluability hypothesis: when a person judges an option is isolation, the judgment is influenced more by attributes that are easy to evaluate than by attribute that are hard to evaluate, even if the hard to evaluate attributes are more important.
To better explain the concept of an attribute that is hard or easy to evaluate, think to an attribute hard to evaluate as a situation where the decision maker is not aware of its distribution information , and consequently does not know whether a given value n the attribute is good or bad. In the opposite situation we will have an attribute that is easy to evaluate.
In this scenario we will have
· The actual value of the gift (€55 vs €45) à this is not the only factor that influences one’s judgment. Norm theory suggests that when people evaluate an object in isolation they often think to other objects in the same category and compare the stimulus object to the other objects.
· The relative value of the gift in its own product category à the relative expensiveness of a €55 wool coat within the wool coat category and the relative expensiveness of a €45 wool scarf within the wool scarf category.
The actual factor, without comparison, it is difficult to evaluate, you don’t know if €45 for a gift is good or bad. The relative position of the given gift it its category is easy to evaluate, as an example people would have some distribution information (price range) of this attribute.
The evaluability hypothesis predicts that one’s evaluation of the gift would be influenced primarily by the relative position attribute and not by the actual value. People are very sensitive to the relative position of the gift within its category; as long as the attribute is hard to evaluate the low option will be valued more high in separate evaluation.
In the ice cream example, we have a scenario where the individual wants an ice cream and there are two ice cream vendors, one offering a 10oz cup putting 8oz if ice cream and the other offering a 5oz cup putting 7oz of ice cream. Which vendor does the individual choose?
In the ice cream example, we have a scenario where the individual wants an ice cream and there are two ice cream vendors, one offering a 10oz cup putting 8oz if ice cream and the other offering a 5oz cup putting 7oz of ice cream. Which vendor does the individual choose?
The individual will prefer the 5oz cup.
The amount of the ice cream should be the only value of concern to the consumer, here the cup size is a reference point in separate evaluation. Whether the cup was overfilled or underfilled represented the relation between the value of concern (the amount of ice cream) and the reference (the cup size).
When the alternative of a proposition is evaluated separately, not together. In these situations the lesser or smaller alternative will be preferred.
Probably a €45 scarf will result to picture the gift giver as more generous if compared with a €55 coat. Similarly, a 5oz cup of ice cream overfilled with 7oz of ice cream will be preferred to a 10oz cup of ice cream underfilled with 8oz of ice cream. IT IS IMPORTANT to underline that these results, and the consequent existence of the less-is-better effect, occur when the alternative of a proposition is evaluated separately, not together. In these situations the lesser or smaller alternative will be preferred.
As stated by Hsee we can conclude highlighting that a higher valuation of a low value option in separate evaluation is not a violation of the dominance principle. It is only from the dominance perspective of the experimenter that one option is more valuable than the other one (if you are the gift giver and you have to choose what to buy between the scarf and the coat, you are the only person who knows the comparison). Your friend does not realize this relation and therefore does not knowingly prefer the low value option.
Studies about joint evaluation and single (separated) evaluation of a situation have led to the discovery of a new bias: the distinction bias. This bias is related with predictions made about events or choices. However, this will be the topic of a future article.
For the time being, just remember that in separated evaluations of propositions the lesser option is preferred, so you can save €10 buying a €45 scarf instead of a €55 coat for your friend, paying attention to “forget” the existence of the coat!
