Endogenous formation of preferences: Choices systematically change willingness-to-pay for goods.

Abstract

Standard decision theory assumes that choices result from stable preferences. This position has been challenged by claims that the act of choosing between goods may alter preferences. To test this claim, we investigated in three experiments whether choices between equally valued snack food items can systematically shape preferences. We directly assessed changes in participants' willingness-to-pay for these items, some of which could be bought at an auction after the experiment, while others could not. We found that chosen items were valued higher, and nonchosen items were valued lower; yet this postdecisional refinement of preferences was only observed for choices and valuations that were relevant, that is, incentive-compatible for items that were available for consumption. Supplementary analyses revealed that incentive-incompatible elicitations of preferences were unreliable and may have masked potential effects of choices on preferences. In conclusion, we propose that preferences can change endogenously, that is, in the absence of external feedback or information, but rather as a function of previous relevant choices. (PsycINFO Database Record

How Decisions and the Desire for Coherency Shape Subjective Preferences Over Time

“…The objective of decision making is therefore to reduce the error between one's past choices and present preferences; we refer to this general mechanism as coherency maximization. Consistent with patterns of repeatpurchasing observed in supermarket consumers 24 and studies of choice-induced preference change [11][12][13][14][15][16][17][18][19][20][21][22][23] , coherency maximization boosts the likelihood of past choices being repeated by shifting preferences towards the chosen item and away from rejected alternatives. As was shown in a simple simulation, this mechanism can elicit strong subjective preferences in the absence of extrinsic feedback.…”

“…As well as facilitating the inference of preferences, past choices also shape them. This has been demonstrated in studies of free choice, which show that after freely choosing an option, people tend to increase their subjective preference for it [11][12][13][14][15][16][17][18][19][20][21][22][23][24] . In the original free-choice paradigm, Brehm 11 asked participants to rate a set of items (e.g.…”

Hard Decisions Shape the Neural Coding of Preferences

“…In addition, while preference changes were absent at the behavioral level for correct guesses, a significant neural effect for spread of alternatives in this condition could nevertheless be observed in the precuneus. This region has been associated with the rapid formation and retrieval of episodic memory (Brodt et al, 2016), with self-relevant processing (Kircher et al, 2002) and with decisions based on guessing (Bode et al, 2013). The precuneus might therefore be involved in less certain retrieval processes for items, which only lead to smaller, behaviorally subthreshold choiceinduced preference change effects.…”

“…4B). These regions have previously been related to decisions between equally valued options, approach conflicts, and choice anxiety (van Veen et al, 2009;Kitayama et al, 2013;Shenhav and Buckner, 2014).…”

“…Additionally, we hypothesized that fixation durations play a significant role in solving hard decisions. Support for this conjecture stems from studies demonstrating that visual fixations causally relate to value-based choices: options that are looked at for longer are more likely to be chosen (Krajbich et al, 2010) and experimental manipulations of exposure duration bias preferences toward the longer presented option (Shimojo et al, 2003). These findings indicate that future values of choice options might be reconstructed by information gathered "in the moment" via fixations.…”