Choice and Environment: Why availability trumps cognition

(appealing) Availability(eventually) Beats (rational) Cognition

Dr. Russell James IIITexas Tech University

Past Expected Future

Alternative

Nearby additional

Relevant Observed

Current

Multiple Alternative

Our choices and our satisfaction

are driven by the comparisons

we make

Behavioral Economics Concepts

Past Expected Future

Alternative

Nearby additional

Relevant Observed

Current

Multiple Alternative

Hedonic Adaptation

Placebo Effect;

Stereotypes

Peer Effects; Relative Standing

Endogenous Determination of Time Preference

Anchoring; Paradox of

Choice

Loss Aversion; Endowment Effect;

Status Quo Bias

Availability Effects

The Dual-Self Model of Consumer Choice

Short-term/impulsive DoerPassionsAffective/VisceralHot state

Long-term/patient PlannerImpartial spectatorDeliberative Cold state

The elephant understands certain emotions and drives

Short-termImpulsive DoerPassionsAffective/VisceralHot state

Long-termPatient PlannerImpartial spectatorDeliberative Cold state

Hunger Anger Fear Lust Thirst Pain

To stay “G” rated, let’s look at hunger…

Hunger conflict



These would taste good, but doughnuts fried in oil are high

in saturated fat and sugar, which would make me fatter,

slower, and less healthy.

Eat them all now!

Why is choice of environment important?

(appealing) Availability (eventually) Beats (rational) Cognition

appealing Availability eventually Beats rational Cognition

Eat them all now!When the rider is

vigilant, the rider may temporarily succeed.

But, when the rider eventually becomes tired or distracted, immediate availability will win.

Good experience, but offset by

long-term results.

When the rider becomes distracted immediate availability wins…

Group memorizing 2-digit number chose chocolate cake 41% of the time

Group memorizing 7-digit number chose chocolate cake63% of the time

When the rider becomes distracted immediate availability wins…

A (memory task) B (no memory task)

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“Availability of … energy dense foods, is also a major risk factor for other consumption related pathology, such as certain forms of obesity and type-2 diabetes.”Ahmed, S. (2005) Imbalance between drug and non-drug reward availability: A major risk factor for addiction. European Journal of Pharmacology, 526, p. 11.


“alcohol problems vary with alcohol availability; this body of evidence is among the strongest bodies of evidence in existence linking health problems to determinants.” Mann, 2005, Availability as a law of addiction. Addiction, 100, p. 924.


“Drinking and alcohol related problems can be affected by restriction of the hours and days of alcohol purchasing and of the numbers and types of alcohol outlets.” Room, Babor, & Rehm, 2005, Alcohol and public health. The Lancet, 365, p. 526.


“Among environmental factors, drug availability represents a major risk factor. Increased drug availability can precipitate the transition to addiction”

Ahmed, S. (2005) Imbalance between drug and non-drug reward availability: A major risk factor for addiction. European Journal of Pharmacology, 526, p. 11.


Does physicians’ greater drug knowledge protect them against greater availability?

Physicians in the U.S. use more opiates and benzodiazepine than others of the same age

Male physicians in Sweden were more than twice as likely to be using tranquilizers as non-physicians

“A higher percentage of drug users among physicians can be due to the fact that self-treatment is widespread”

Rosvold, E. (U. of Oslo), Vaglum, P. (U. of Oslo), Moum, T. (U. of Oslo), 1998, Use of minor tranquilizers among Norwegian physicians. A nation-wide comparative study. Social Science & Medicine, 46, 581-590.

Excessive availability increases consumption

I’ll have just a few…It’s not like I’m eating all 40!


For any Scarface fans, you may recall that this environment did not produce a happy ending…

Group A5 unlimited bottles of water and 1 unlimited bottle of sugar water

Group B1 unlimited bottle of water and 5 unlimited bottles of sugar water

a) Group A consumed more sugar?b) Group B consumed more sugar?c) No difference?

A lab experiment


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Tordoff, M. G. (2002) Obesity by choice: The powerful influence of nutrient availability on nutrient intake. American Journal of Physiology – Regulatory, Integrative and Comparative Physiology, 282, 1536-1539.

Group AAverage fat content of rats after 36

days: 57 grams


Group BAverage fat content of rats after

36 days: 76 grams

Both groups had unlimited access to Purina rodent chow during the test.


Any relevance for humans?

What about alcohol?

Group A5 unlimited bottles of water and 1 unlimited bottle of 10% alcohol

Group B1 unlimited bottle of water and 5 unlimited bottles of 10% alcohol

Did it make any difference?


Group AAlcohol intake grams per kilogram of mouse body weight: 9.4

Group BAlcohol intake grams per kilogram of mouse body weight: 23.4

What about with different ratios? What about a different breed?What about a rat instead of mouse?


Alcohol as a % of total liquid intakeUnlimited bottles Mice

(129x1/Svj)Rats

1 alcohol vs. 5 water 9% 3%2 alcohol vs. 4 water 16% 7%3 alcohol vs. 3 water 24% 15%4 alcohol vs. 2 water 32% 16% 5 alcohol vs. 1 water 42% 31%

Tordoff, M. G., & Bachmanov, A. A. (2003) Influence of the number of alcohol and water bottles on murine alcohol intake. Alcoholism: Clinical and Experimental Research, 27(4), 600-606.

“Large packages, plates, and serving bowls… have all been shown to increase how much a person serves and consumes by 15% to 45%.”

B. Wansink (Cornell), D. Just (Cornell), & C. Payne (New Mexico State U), 2009, Mindless eating and health heuristics for the irrational. American Economic Review, 2009, 99(2), 165-169.

Experiment with Free Popcorn at a Movie Theatre

If nobody finished all of the popcorn, did container size still matter?

One group got

240 g buckets

One group got

120 g buckets

Even though no one finished all of the popcorn, bigger portions → more eaten

Group with large buckets consumed 85.6 grams on

average.Group with medium

buckets consumed 58.9 grams on average.

Another group was given 14-day old popcorn in medium and large buckets.

“This popcorn tasted good” (1=strongly disagree; 9=strongly agree)Medium container: fresh = 7.7 old = 3.9Large container: fresh = 6.8 old = 2.2

Did people eat more bad popcorn just because it was in a bigger container?

Bigger portions of bad popcorn = more eaten

Group with large buckets of 14-day old popcorn consumed 50.8 grams.

Group with medium buckets of 14-day old popcorn consumed 38.0 grams.

Wansink, B. & Kim, J. (2005) Bad popcorn in big buckets: Portion size can influence intake as much as taste. Journal of Nutrition Education and Behavior, 37(5), 242-245.

Size v. Taste

Large Fresh Med Fresh Large Stale Med Stale0

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The misperceived effects of availability

“In one study, unknowing diners were served tomato soup in bowls that were refilled through concealed tubing that ran through the table and into the bottom of the bowls. People eating from these “bottomless” bowls consumed 73% more soup than those eating from normal bowls but estimated that they ate only 4.8 calories more.”

B. Wansink (Cornell) & J. Sobal (Cornell), 2007, Mindless eating: The 200 daily food decisions we overlook. Environment & Behavior, 39(1), 106-123, p. 109.

Excessive availability and consumption

In a study of 10 weight loss techniques, the most effective was using smaller, 10-inch, plates


In the previous study, not eating with the TV on was the second most effective technique for weight loss.

Why might food availability during TV watching be especially relevant according to the dual-self approach?


Study of 10 weight loss techniques used by real world volunteers. The two most effect techniques changed only the eating environment.


METHOD Lbs. of Monthly Weight LossUse ten-inch plates for dinner −1.93Don’t eat with the TV on −1.58Eat fruit before snacking −1.11Eat a hot breakfast −1.07Eat vegetables and salad first −1.05Use the half-plate rule −0.60Store produce on middle refrigerator shelf −0.47Limit snacks to three bites −0.29Brush teeth instead of snacking +0.18Eat oatmeal for breakfast +0.83

Effects of knowledge…

• MBA students had 90 minute class to prove that if they snacked from gallon bowls of Chex Mix they would eat more than if they snacked from half-gallon bowls.

• At a Super Bowl party six weeks later, half were directed to a buffet table with two one-gallon bowls of Chex Mix, the other to a buffet table with four ½ gallon bowls.

• Did information prevent the bigger bowls from having an effect?

B Wansink, & MM Cheney (2005) Journal of the American Medical Association, 293(14), 1727-1728; B. Wansink, D. Just, & C. Payne (2009) American Economic Review, 2009, 99(2), 165-169.

Group A: Four 1/2 Gal-lon Bowls

Group B: Two 1 Gallon Bowls

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The result of your knowledge…

When asked afterwards if they believed the size of the serving bowls influenced them, the students said “no.”

1/2 Gallon Bowls

1 Gallon Bowls

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B Wansink, & MM Cheney (2005) Journal of the American Medical Association, 293(14), 1727-1728; B. Wansink, D. Just, & C. Payne (2009) American Economic Review, 2009, 99(2), 165-169.



The size of this bowl has nothing to do with how much we should eat.

You watch TV. I’ll eat.

Availability beats cognition even when…

You know about the effects of environment on your decisionsYou don’t believe the environment is changing your decisions

Your KNOWLEDGE of the impact of environment on your behavior

and your BELIEF about the impact of environment on your behavior

doesn’t CHANGE the impact of the environment on your behavior.

So, what can we do?

1. Whether we admit it or not, more knowledge won’t change the impact of environment on our behaviors.

2. But, changing our environment can change our behaviors.

We can focus more on choosing our environment!

So why don’t we choose our environment to match our goals?

Hyperbolic discounting [We will make better choices in the future]

Projection bias [The “rider” will always be in control]

Diversification bias [We want maximum options]

For health reasons, I would like to increase the amount of raw vegetables, like carrots and celery, I eat. They don’t taste bad, but they aren’t that exciting, either.

What practical suggestions can you think of to help each person by employing the principal of “availability beats cognition”?

Work with one or more people around you and discuss. Have one person write down all of the different suggestions you can come up with and sign all of your names to the page.

I would like to reduce the amount of sugar I eat, but I have problems with self-control because I really like sweets.

Slides by: Russell James III, J.D., Ph.D., CFP®Associate Professor Division of Personal Financial Planning Texas Tech [email protected]

Please use these slides!

If you think you might use anything here in a classroom,

please CLICK HERE to let me know.

Thanks!

The outline for this behavioral economics series is at http://www.slideshare.net/rnja8c/outline-for-behavioral-economics-course-component

http://www.surveymonkey.com/s.aspx?sm=1jIdZgtJHGbjjqPRIjFP4Q_3d_3d

http://www.slideshare.net/rnja8c/outline-for-behavioral-economics-course-component

http://www.slideshare.net/rnja8c/outline-for-behavioral-economics-course-component

Choice and Environment: Why availability trumps cognition

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