8

If that same effect is happening with the "99% fat free" labeling, consumers would over-perceive the amount of fat I think you are misunderstanding the desired effect here. I don't see how "99% fat free" would lead to the impression that a product contains a lot of fat. My read is, "This is 99% fat free! That's really good!" as opposed to "1% fat" which ...


7

This is just an elaboration on my comment that Sanford et al (2002) might be relevant to the question. If you don't have access Tony Sanford indicates that "To obtain a copy of any of these papers, please email." The study reports three experiments. In experiment 2 they found experimentally that there was a preference for the "% fat free" format. Twenty-...


6

The experiment you are referring to is usually called the ultimatum game, and was first experimentally tested by Güth, Schmittberger, and Schwarze in 1982 [1]. [1] Güth, Werner, Rolf Schmittberger, and Bernd Schwarze. "An experimental analysis of ultimatum bargaining." Journal of Economic Behavior & Organization 3.4 (1982): 367-388. PDF


6

I've found Neighbors as Negatives: Relative Earnings and Well-Being by E.F.P. Luttmer (2005), although I'm not sure it's the right one. I've heard about your study as well, but I thought it was older than 2005. You can read the study I linked and look up the references. There are quite a lot that touch the same subject.


5

Yes. This is a special case of the identifiable victim effect: the cognitive bias implicated in the quote, "A single death is a tragedy; a million deaths is a statistic." The identifiable victim effect might be paraphrased as the tendency to view harm of many as unimportant. A direct corollary is the tendency to view small harm of many as unimportant. Going ...


4

Partial answer: Douglas Hofstadter has written quite a lot about this from a more philosophical approach. His style isn't for everyone, I think it's introduced well in this chapter ('Ant Fugue'). For more applied work from the same, you might look at Mitchell and Hofstadter's CopyCat model of analogies (described briefly here, as well as on wikipedia). All ...


4

It's called "accentuate the positive, eliminate the negative." Or put another way, it's easier to portray the glass as "half full" rather than "half empty." Especially when the ratio is not 50-50, but 99- to -1. That is "99 percent good" sounds a lot better than "1 percent bad." The above psychological factors are so powerful that they appear to outweigh ...


4

Because we still don't know exactly how the brain works. That's why we do research. If these authors knew the answer ahead of time, neither of them would have done the study. These are research papers, they are showing findings that are consistent with different models. Maybe the real model is somewhere in between, maybe there are context-dependencies, ...


3

The economic concept of marginalism comes to mind. Actors will spend money to buy virtual goods if the marginal cost (price) is lower than the marginal (subjective) utility of the virtual good. If you have lots of money it's easier to spend $10 on extra lives. This explains some of it. Most of the purchases are small, so the individual cost/utility analysis ...


3

In alignment with the question author's commentary refinement, "It would already be a nice and useful answer if there was -any- clue on -any- type of happiness.":I submit: Stevenson, Betsey, and Justin Wolfers. "Subjective Well-Being and Income: Is There Any Evidence of Satiation?" American Economic Review 103.3 (2013): 598-604. Web. Abstract Many ...


3

Bystander Effect The Bystander Effect could be your answer. The more people, the less personal responsibility. Person gets assaulted and mugged on a crowded street in broad daylight, nobody calls the cops. Software bugs slow company productivity almost to a halt, many employees, nobody reports the problem. Tragedy of the Commons The tragedy of the ...


3

I am not sure I understand the refill example, and I do not have any empirical study in mind, but here is a classical fictitious example drawn from Mas-Collel, Winsthon and Green, Microeconomics, which might be relevant to your question. The example is slightly far-fetched but I think it's good to get the idea. Suppose you want to choose a color to paint ...


3

This is quite a broad question, and the feasibility of any answer will depend on the time and resources available for performing a demonstration, assuming the objective isn't just to present a summary of existing research. A relatively simple principle to demonstrate in a risk management context would be the framing effect, whereby the emphasis on gain or ...


2

Quiet simply: loss aversion People are adverse to loss, the majority of people who are wealthy pay into a system they get little direct benefit from, in comparison to poorer people who tend to get back what they put in or more depending on circumstance. However the rich, and everyone else, benefit from being in wealthy westernised societies with higher ...


2

You certainly did not understand it correctly, because the statement that the second case is either rational or not cannot be stated based only on the information you provided. The rationality of the second statement depends on the specific decision-maker's attitude to risk only. It is not possible to infer it based only on the information you are providing....


2

This is pretty close to being a classic example of a framing effect (wikipedia), originally described in the literature by Tversky & Kahneman (1986). In essence, our subjective valuation of a choice or outcome isn't invariant, as economic theory says it should be, but instead is influenced by contextual effects, such as riskiness, and if the outcome is ...


2

Summary: From the few papers I've looked at, microtransaction-based games tend to work as suspected/designed. That is, games which rely on frustration to get the player to spend money (like Candy Crush) tend to obtain money from players with low tolerance for frustration; games which are more related to gambling (like "social casino" games) tend to get money ...


2

It seems that despite the idea's intuitive appeal, the evidence is currently mixed with respect to whether loss aversion can explain dollar cost averaging strategies. Most research I can find seems to be financial and normative, pertaining to whether the strategy performs well more than behavioral and descriptive concerns for why people engage in the ...


2

Grabner-Kräuter et al (2003) suggest that Lack of trust is one of the most frequently cited reasons for consumers not purchasing from Internet vendors. References Grabner-Kräuter, S., & Kaluscha, E. A. (2003). Empirical research in on-line trust: a review and critical assessment. International Journal of Human-Computer Studies, 58(6), 783-812. ...


2

This comes under the heading of the theory of organized interests.The idea is that there are a few parties that stand to make large gains from a situation, and therefore have an incentive to organize and capture these gains. Meanwhile, there is a large number of people that stand to receive small losses. Because these losses are individually "small," the ...


1

At least in part, the games include elements that make children more susceptible to buying in-app-purchases. Though this tactic may have been somewhat attenuated. In some other cases, I found the following conclusion from this review paper: Purchase behavior is explained primarily with purchase intention but also with habits. Purchase ...


1

I asked the same question in the private beta of the newly open Economics.SE and got some interesting answers. You can check them out at https://economics.stackexchange.com/questions/95/experiments-contradicting-the-expected-utility-model


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