Can You Influence the Compromise Effect of Decision Making?

Abstract

Have you ever given any thought to the question, "What size drink do you want?" This experiment explores the behavioral neuroscience behind decision-making. It will explore why we make certain choices and even how we rationalize our choices after we make them.

Summary

Areas of Science

Human Behavior
Sociology

Difficulty

Method

Scientific Method

Time Required

Short (2-5 days)

Prerequisites

None

Material Availability

All items are readily available. 

Cost

Very Low (under $20)

Safety

No safety issues. Consent is required of all participants. 

Credits

Laura Ohl, PhD, Science Buddies Alumni

Science Buddies is committed to creating content authored by scientists and educators. Learn more about our process and how we use AI.

https://www.youtube.com/watch?v=i4GC-L4JSbY

Objective

To investigate the behavioral neuroscience of how we make decisions and test how price and social pressure can influence them. 

Introduction

Have you ever made a decision and thought, why did I make that choice? We make choices every day, from where to sit to when we wake up and what to eat or drink. These choices may seem minor or random, but these many decisions make and influence our days. In fact, we make so many decisions in a day that many of us develop patterns of making quicker decisions. The study of the reasoning behind how we act is called behavioral neuroscience. Making choices or decisions is a complex cognitive process that requires multiple brain regions to participate. Different brain regions are active or inactive during specific types of decision-making. While one set of brain regions is active during reward-based decision-making (getting money after cleaning your room), another is active during risky choices (trying a new sport). All of these brain regions that make these decisions are composed of neurons, the specialized cells of the brain. During decision-making, thousands of these neurons fire in the brain or have action potentials in coordination to communicate with each other so we can make a single decision. That's a lot of brain power! Interestingly, researchers are still working to understand how many brain areas and types of neurons are involved in specific types of decision-making.

One example of a decision we regularly make is choosing from a set of options. We often do this when we go to the grocery store. There may be 6 different types of apples to choose from, and our goal is to choose one type. This requires us to make a complex choice by considering our taste preferences, how many apples we need, and our budget for the apples. However, there are much simpler daily choices we make, such as the opportunity to choose between two drink sizes. Have you ever considered why you choose the drink size you do when going out to a cafe or a restaurant? When presented with two options, we tend to choose the smaller or larger option based on how thirsty we are or how much money we have to spend. We can even use previous decisions to inform our choices. Interestingly, our behavior changes when we introduce a third option in the middle of these two options. This middle option is often seen as a compromise between these two options. This is known as the compromise effect. It is a cognitive behavior that explains our tendency to choose a more intermediate option to avoid extreme choices. Many companies take advantage of this behavior through thoughtful business and marketing tactics. But is the compromise effect real, and how can we influence it? 

Image Credit: Laura Ohl, PhD / Science Buddies

Image of bubble tea cups showing how price typically increases with size to encourage the compromise effect.

How do companies use our own behavior to sway our choices? Many companies advertise or market multiple products to encourage you to use your natural bias toward choosing the middle option with the compromise effect. One way to do this is to keep the item's price at an increasing amount based on the proportional size of the product, known as size-based pricing. Another way marketing can persuade you to choose the middle option is through social psychology or neuroscience. Social proof is our ability to be persuaded or encouraged to choose an option based on other's choices. After online shopping, consumers sometimes leave a review of a product. If we know that others are choosing a particular option, we are more likely to choose it. Have you ever been influenced by other's choices?

After we make a choice, we even use our brains to rationalize our choices. Rationalization is an attempt to explain or find reasons for our decisions. In economics, rationalization of purchase choice is called post-purchase rationalization (also known as choice-supportive bias). For example, we may be overly excited about a decision we made despite the risks it may have, like purchasing an item that's too expensive, despite it being over our budget. Another way we rationalize our choices is through cognitive dissonance, a psychological state in which we adjust our attitudes to support our choices. One example of this is choosing to sunbathe without sunscreen to tan despite knowing that excess exposure to UV light has been linked to an increased risk of skin cancer. You may find it interesting to see how your participants behave and rationalize their choices after they made them, and even identify which type of rationalization they try to make!

Terms and Concepts

• Behavioral neuroscience
• Cognitive
• Neurons
• Action potential
• Compromise effect
• Marketing
• Social psychology/social neuroscience
• Social proof
• Economics
• Post-purchase rationalization
• Cognitive dissonance

Questions

• What is behavioral neuroscience? 
• What neurological process in the brain is required for decision-making?
• How do neurons communicate with each other to make a decision?
• What is the compromise effect?
• What is size-based pricing? Give an example from everyday life.
• What factors can influence our decision-making?
• How does our brain attempt to explain a decision? 
• What are some ways we rationalize our decisions? 

Materials and Equipment

• 10 or more participants (See guide on representative sample sizes.)
• 3 sets of different items of increasing size (total 9 items)
  • Examples: small/medium/large fruits, small/medium/large bowls, small/medium/large cups 
• Lab notebook or paper for data collection

This project follows the Scientific Method. Review the steps before you begin.

Experimental Set-up

Before you start the experiment, you will need to receive informed consent from each participant. After you have received consent, you will present each participant with a set of choices. In this experiment, you can answer if participants succumb to the compromise effect (experimental design A). You can also test how pricing (experimental design B) and social pressures (experimental design C) impact our tendency to choose a particular option. Each table (tables 1-3) below represents one participant's choices, while the final table is a summary of all participant's choices. 

Working with Human Test Subjects

There are special considerations when designing an experiment involving human subjects. Fairs affiliated with Regeneron International Science and Engineering Fair (ISEF) often require an Informed Consent Form (permission sheet) for every participant who is questioned. Consult the rules and regulations of the science fair that you are entering, prior to performing experiments or surveys. Please refer to the Science Buddies documents Projects Involving Human Subjects and Scientific Review Committee for additional important requirements. If you are working with minors, you must get advance permission from the children's parents or guardians (and teachers if you are performing the test while they are in school) to make sure that it is all right for the children to participate in the science fair project. Here are suggested guidelines for obtaining permission for working with minors:

1. Write a clear description of your science fair project, what you are studying, and what you hope to learn. Include how the child will be tested. Include a paragraph where you get a parent's or guardian's and/or teacher's signature.
2. Print out as many copies as you need for each child you will be surveying.
3. Pass out the permission sheet to the children or to the teachers of the children to give to the parents. You must have permission for all the children in order to be able to use them as test subjects.

Experimental Method

1. Inform each participant that you will present them with items of varying sizes. In each scenario, you will ask them to choose an item that they would use or eat and provide a rationale or reason for their choice. 
   1. Note: Participants won't actually use/eat the item. This will control for any variability in items and allow you to reuse them for the entirety of the experiment with multiple participants. 
2. Present each scenario to the participants with each of the 3 sets of items. Repeat each set of items with varying sizes in 3 trials, ideally using different items with each trial. Participants will choose one size for each trial of the scenario.
   1. Experiential design A tests the compromise effect.  
      1. Present the participants with scenario 1 and then scenario 2: 
         • Scenario 1 (2 items: 1 small and 1 large) 
         • Scenario 2 (3 items: 1 small, 1 medium, and 1 large)
      2. Record their size choice, record the majority size choice (the choice most often chosen) for each scenario, and the rationalization for both scenarios in Table 1.  
   2. Experimental design B tests if price can influence the compromise effect. Participants will choose one size for each trial of the scenario.
      1. Present the participants with scenario 3 and then scenario 4: 
         • Scenario 3 (3 items of proportionally increasing price with size: models size-based pricing)
           • Example: small $2, medium $4, large $6
         • Scenario 4 (3 cups of disproportionate increasing price with size)
           • Example: small $2, medium $5, large $6
      2. Record their size choice, the majority size choice for each scenario, and the rationalization for both scenarios in Table 2. 
   3. Experimental design C tests if social proof can influence the compromise effect. Participants will choose one size for each trial of the scenario. 
      1. Present the participants with scenario 5 and then scenario 6: 
         • Scenario 5 (2 items: 1 small, 1 medium, 1 large) 
         • Scenario 6 (3 items: 1 small, 1 medium, 1 large; but inform participants that others recommend the large option to model social proof)
      2. Record their size choice, the majority size choice for each scenario, and the rationalization for both scenarios in Table 3.
3. Record the majority of size choices from the results of each scenario (Table 1-3) under each participant's column to look at the overall choices of all participants in Table 4. 
   1. Calculate the proportion of participants' majority size choices for each scenario with the following equation :
      1. Proportion of choice for small item = (Number of participants who choose small option) / (total number of participants)
      2. Proportion of choice for medium item = (Number of participants who choose medium option) / (total number of participants)
         • Note: You can omit the medium option calculation for Scenario 1 since there are only small and large options for that decision-making scenario.
      3. Proportion of choice for large item = (Number of participants who choose large option) / (total number of participants)

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Table 1. Data collection table to determine if a participant succumbs to the compromise effect.

(A) Choices	Trial 1 Size Choice	Trial 2 Size Choice	Trial 3 Size Choice	Majority Size Choice	Rationalization
Scenario 1
Scenario 2

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Table 2. Data collection table to determine if price influences the compromise effect for a participant.

(B) Choices with Pricing	Trial 1 Size Choice	Trial 2 Size Choice	Trial 3 Size Choice	Majority Size Choice	Rationalization
Scenario 3
Scenario 4

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Table 3. Data collection table to determine if social proof changes the compromise effect for a participant.

(C) Choices with Social Proof	Trial 1 Size Choice	Trial 2 Size Choice	Trial 3 Size Choice	Majority Size Choice	Rationalization
Scenario 5
Scenario 6

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Table 4. A summary data table to show all participants' choices in each scenario.

Choices	Participant 1 Majority Size Choice	Participant 2 Majority Size Choice	…	Participant 10 Majority Size Choice	Proportion of Each Choice
Scenario 1
Scenario 2
Scenario 3
Scenario 4
Scenario 5
Scenario 6

Conclusion

• What was the most common choice(s) for scenario 1 and scenario 2? Were the choices random in scenario 1, or was there more of a consensus? How about scenario 2? Did participants succumb to the compromise effect in scenario 2?
• How did the results stay the same or vary in scenarios 3 or 4? Did price influence the compromise effect?
• How did the results stay the same or vary for scenarios 5 or 6? Did social proof influence the compromise effect?
• What was the most common rationale for each choice in each scenario? Are there any trends? Do any participants participate in post-purchase rationalization in experimental design B? Do any participants create cognitive dissonance in their choice?
• How did price impact the compromise effect? Were there any tendencies to choose the maximum volume per price (also known as loss aversion)?
• How did social proof influence the compromise effect? Were participants more or less likely to choose something based on others making a particular choice? Were some participants more resilient or avoidant of making a conformative choice than others? 
• Did price or social proof have a more considerable influence on the participants' decision-making overall? How can you tell?

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Global Goals

The United Nations Sustainable Development Goals (UNSDGs) are a blueprint to achieve a better and more sustainable future for all.

This project explores topics key to Good Health and Well-Being: Ensure healthy lives and promote well-being for all at all ages.

This project explores topics key to Decent Work and Economic Growth: Promote inclusive and sustainable economic growth, employment and decent work for allZ.

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