Contemporary Issues Science of Happiness WEEK 3 Schwartz, B. (2005). The paradox of Choice: Why more is less. Ch. 3 & 4 Last week •Hedonistic approach •Eudaimonic approach • •Brickman and Campbell, (1971) Hedonic Treadmill • •Dan Gilbert’s talk on synthesizing happiness - relativity Today’s class •1/experience vs. memory – D.Kahneman •2/ happiness and decision making • Cognition •mental processes ▫Attention, remembering, producing and understanding language, solving problems, and making decisions ▫Term used in multiple fields (psychology, philosophy, linguistics, science and computer science ) ▫In psychology & cognitive science –Information processing, individual's psychological functions –social psychology – attitudes, attributions, group dynamics. Barry Schwartz •(born 1946) •Dorwin Cartwright (Group Dynamics) Professor of Social Theory and Social Action at Swarthmore College •Psychology and Economics •Decision Making, Creation of Values, Interaction of Morality and Self Interest, Work Satisfaction, Role of Ideology in Assessing, Psychological Theories, Basic Learning Processes • Deciding and Choosing •Decision-making steps Deciding and Choosing •Decision-making steps ▫Goals ▫Evaluate ▫Array options ▫Meeting your goals ▫Pick the winner ▫Feedback ▫ ▫ Deciding and Choosing •Decision-making steps ▫Goals ▫Evaluate ▫Array options ▫Meeting your goals ▫Pick the winner ▫Feedback ▫ ▫ Cognitive errors Figure out the goals •WHAT DO YOU WANT? • •Utility – measure of relative satisfaction •Utility of the experience – present, past, future Decision-making steps: Goals Evaluate Array options Meeting your goals Pick the winner Feedback Figure out the goals •WHAT DO YOU WANT? • •Utility – measure of relative satisfaction •Utility of the experience – present, past, future •What we want? How we think it is going to make us feel? How does it make us feel? How do we remember it made us feel? • Figure out the goals •WHAT DO YOU WANT? • •Utility – measure of relative satisfaction •Utility of the experience – present, past, future • •Video – cognitive traps - D. Kahneman –Complexity of the concept –Focusing illusion –Experience vs. memory Evaluation •Ads??? •Internet??? •Quality and Quantity of information we gather • •Back to utilities – remembered, experienced, expected •Experiencing vs. remembering self – impact Decision-making steps: Goals Evaluate Array options Meeting your goals Pick the winner Feedback Anchoring & Framing •Context of comparison • •Decision making and risk/ uncertainty • •“psychological accounts” • • Example • •Imagine that you are a physician working in an Asian village, and six hundred people have come down with a life-threatening disease. Two possible treatments exist. If you choose treatment A, you will save exactly two hundred people. If you choose treatment B, there is a one-third chance that you will save all six hundred people, and a two-thirds chance that you will save no one. Which treatment do you choose, A or B? Example • •Imagine that you are a physician working in an Asian village, and six hundred people have come down with a life-threatening disease. Two possible treatments exist. If you choose treatment A, you will save exactly two hundred people. If you choose treatment B, there is a one-third chance that you will save all six hundred people, and a two-thirds chance that you will save no one. Which treatment do you choose, A or B? Majority of people choose A Example •You are a physician working in an Asian village, and six hundred people have come down with a life-threatening disease. Two possible treatments exist. If you choose treatment C, exactly four hundred people will die. If you choose treatment D, there is a one-third chance that no one will die, and a two-thirds chance that everyone will die. Which treatment do you choose, C or D? Example •You are a physician working in an Asian village, and six hundred people have come down with a life-threatening disease. Two possible treatments exist. If you choose treatment C, exactly four hundred people will die. If you choose treatment D, there is a one-third chance that no one will die, and a two-thirds chance that everyone will die. Which treatment do you choose, C or D? Majority of people choose D Example •When making decisions among alternatives that involve certain amount of risk/ uncertainty • ▫People prefer small sure gain to a larger, uncertain one ▫ ▫ ▫ ▫ ▫FRAMING PSYCHOLOGICAL ACCOUNTS – gain and losses Kahneman & Tversky •Prospect theory – constructing general explanations and evaluating options • • • Kahneman & Tversky •Prospect theory – constructing general explanations and evaluating options •Law of diminishing marginal utility ▫As the rich gets richer, each additional unit of wealth satisfies them less • ▫Risk aversion – when deciding among potential gains • Kahneman & Tversky •Prospect theory – constructing general explanations and evaluating options •Decreasing marginal disutility of losses ▫Loosing first $100 hurts more than loosing second $100 ▫ ▫ ▫Risk seeking – taking the risk to perhaps avoid losing anything C:\Users\Petrovicova\Documents\skola FSS\Teaching\Contemporary Issues in Psychology\literature\pic1.tif Kahneman & Tversky •Prospect theory – constructing general explanations and evaluating options •Law of diminishing marginal utility •Decreasing marginal disutility of losses • • •Risk seeking/ Risk aversion • •In Politics – framing and loss aversion •Gambling – loss aversion • Kahneman & Tversky •Gain or loss – question of POINT ZERO – frame and prospect •Point zero – can change • •Endowment effect – once something is given to you, it’s yours – therefore trading it = loss • Decision making •Maximizer •Satisficer Decision making •Maximizer – the best, check all the options, certainty •Satisficer – good enough, looking till finds good enough, follows criteria and standards • •Statisficing as maximizing strategy (cost/benefit ration) Maximizers vs Satisficers •13 item survey •E.g. Whenever I’m faced with a choice, I try to imagine what all the other possibilities are, even ones that aren’t present at the moment •I often find it difficult to shop for a gift for a friend •When shopping, I have a hard time finding clothing that I really love •… Maximizers vs Satisficers • M – more product comparisons, , before and AFTER purchase Maximizers vs Satisficers • M – more product comparisons, , before and AFTER purchase •M- longer time to decide Maximizers vs Satisficers • M – more product comparisons, , before and AFTER purchase •M- longer time to decide •M – compare their own decisions to decision of others Maximizers vs Satisficers • M – more product comparisons, , before and AFTER purchase •M- longer time to decide •M – compare their own decisions to decision of others •M – more likely to experience regret •M – spend more time thinking about alternatives (hypothetical) •M – generally less satisfied with their choices!!! Maximizers vs Satisficers • M – savod positive experiences less • - do not cope well with negative outcomes • - longer recovery from negative events • - ruminate more • • •….overall… Maximizers vs Satisficers • M – avoid positive experiences less • - do not cope well with negative outcomes • - longer recovery from negative events • - ruminate more • • •….overall…less satisfaction with life, less optimistic, more depressive symptoms Maximizers vs Satisficers • M – savor positive experiences less • - do not cope well with negative outcomes • - longer recovery from negative events • - ruminate more • • •….overall…less satisfaction with life, less optimistic, more depressive symptoms •…however - not cause and effect relationship – WHY CAN’T WE MAKE THIS CONCLUSION? • …correlational effect vs. causal Is it all that bad? •Objective vs. subjective criteria •Which one matters? • •Maximizers- tend to do better when it comes to objective criteria ( “better decisions”) • Is it all that bad? •Objective vs. subjective criteria •Which one matters? •Subjective experience – related to the quality of the objective experience • Is maximizing a Perfectionism? • Is maximizing a Perfectionism? •Correlated – YES •Interchangabme – NO • •Qualitatively different – how? Is maximizing a Perfectionism? •Correlated – YES •Interchangabme – NO • •Qualitatively different – how? • ▫Difference in the expectations to meet high standards ▫ Is maximizing a Perfectionism? •Correlated – YES •Interchangabme – NO • •Qualitatively different – how? • –Difference in the expectations to meet high standards –P – don’t expect to meet these expectations –M- do expect to meet these expectations ▫à But they never do…P are actually more happy and less depressed ▫ Is it all that bad? •Objective vs. subjective criteria •Subjective experience – related to the quality of the objective experience • •PLUS: Maximizing tend to be domain specific ▫We all may maximize in some areas… ▫Difference between M and S – in number of decision using one or another strategy • • Why would anyone maximize? •Lack of awareness •Status •Scarce/ very rare goods •… •… • • Why would anyone maximize? •Lack of awareness •Status •Scarce/ very rare goods •… •… •Does choice create maximizers? •How to study this? •