1. Study examines effect of psychology on markets

    July 9, 2013 by Ashley

    From the Caltech press release via EurekAlert!:

    chart_diagramWhen it comes to economics versus psychology, score one for psychology.

    Economists argue that markets usually reflect rational behavior—that is, the dominant players in a market, such as the hedge-fund managers who make billions of dollars’ worth of trades, almost always make well-informed and objective decisions. Psychologists, on the other hand, say that markets are not immune from human irrationality, whether that irrationality is due to optimism, fear, greed, or other forces.

    Now, a new analysis published in the XX issue of the Proceedings of the National Academy of Sciences (PNAS) supports the latter case, showing that markets are indeed susceptible to psychological phenomena. “There’s this tug-of-war between economics and psychology, and in this round, psychology wins,” says Colin Camerer, the Robert Kirby Professor of Behavioral Economics at the California Institute of Technology (Caltech) and the corresponding author of the paper.

    Indeed, it is difficult to claim that markets are immune to apparent irrationality in human behavior. “The recent financial crisis really has shaken a lot of people’s faith,” Camerer says. Despite the faith of many that markets would organize allocations of capital in ways that are efficient, he notes, the government still had to bail out banks, and millions of people lost their homes.

    In their analysis, the researchers studied an effect called partition dependence, in which breaking down—or partitioning—the possible outcomes of an event in great detail makes people think that those outcomes are more likely to happen. The reason, psychologists say, is that providing specific scenarios makes them more explicit in people’s minds. “Whatever we’re thinking about, seems more likely,” Camerer explains.

    For example, if you are asked to predict the next presidential election, you may say that a Democrat has a 50/50 chance of winning and a Republican has a 50/50 chance of winning. But if you are asked about the odds that a particular candidate from each party might win—for example, Hillary Clinton versus Chris Christie—you are likely to envision one of them in the White House, causing you to overestimate his or her odds.

    The researchers looked for this bias in a variety of prediction markets, in which people bet on future events. In these markets, participants buy and sell claims on specific outcomes, and the prices of those claims—as set by the market—reflect people’s beliefs about how likely it is that each of those outcomes will happen. Say, for example, that the price for a claim that the Miami Heat will win 16 games during the NBA playoffs is $6.50 for a $10 return. That means that, in the collective judgment of the traders, Miami has a 65 percent chance of winning 16 games.

    The researchers created two prediction markets via laboratory experiments and studied two others in the real world. In one lab experiment, which took place in 2006, volunteers traded claims on how many games an NBA team would win during the 2006 playoffs and how many goals a team would score in the 2006 World Cup. The volunteers traded claims on 16 teams each for the NBA playoffs and the World Cup.

    In the basketball case, one group of volunteers was asked to bet on whether the Miami Heat would win 4 playoff games, 8 games, or some other range. Another group was given a range of 4 games, which combined the two intervals offered to the first group. Then, the volunteers traded claims on each of the intervals within their respective groups. As with all prediction markets, the price of a traded claim reflected the traders’ estimations of whether the total number of games won by the Heat would fall within a particular range.

    Economic theory says that the first group’s perceived probability of the Heat winning 4 games and its perceived probability of winning 8 games should add up to a total close to the second group’s perceived probability of the team winning 4 games. But when they added the numbers up, the researchers found instead that the first group thought the likelihood of the team winning 4 or 8 games higher than did the second group, which was asked about the probability of them winning 4 games. All of this suggests that framing the possible outcomes in terms of more specific intervals caused people to think that those outcomes were more likely.

    The researchers observed similar results in a second, similar lab experiment, and in two studies of natural markets—one involving a series of 153 prediction markets run by Deutsche Bank and Goldman Sachs, and another involving long-shot horses in horse races.

    People tend to bet more money on a long-shot horse, because of its higher potential payoff, and they also tend to overestimate the chance that such a horse will win. Statistically, however, a horse’s chance of winning a particular race is the same regardless of how many other horses it’s racing against—a horse who habitually wins just five percent of the time will continue to do so whether it is racing against fields of 5 or of 11. But when the researchers looked at horse-race data from 1992 through 2001—a total of 6.3 million starts—they found that bettors were subject to the partition bias, believing that long-shot horses had higher odds of winning when they were racing against fewer horses.

    While partition dependence has been looked at in the past in specific lab experiments, it hadn’t been studied in prediction markets, Camerer says. What makes this particular analysis powerful is that the researchers observed evidence for this phenomenon in a wide range of studies—short, well-controlled laboratory experiments; markets involving intelligent, well-informed traders at major financial institutions; and nine years of horse-racing data.


  2. Study links teens’ self-consciousness with specific brain, physiological responses

    by Ashley

    From the Association for Psychological Science press release via EurekAlert!:

    twin_teen_girlsTeenagers are famously self-conscious, acutely aware and concerned about what their peers think of them. A new study reveals that this self-consciousness is linked with specific physiological and brain responses that seem to emerge and peak in adolescence.

    “Our study identifies adolescence as a unique period of the lifespan in which self-conscious emotion, physiological reactivity, and activity in specific brain areas converge and peak in response to being evaluated by others,” says psychological scientist and lead researcher Leah Somerville of Harvard University.

    The findings, published in Psychological Science, a journal of the Association for Psychological Science, suggest that teens’ sensitivity to social evaluation might be explained by shifts in physiological and brain function during adolescence, in addition to the numerous sociocultural changes that take place during the teen years.

    Somerville and colleagues wanted to investigate whether just being looked at — a minimal social-evaluation situation — might register with greater importance, arousal, and intensity for adolescents than for either children or adults. The researchers hypothesized that late-developing regions of the brain, such as the medial prefrontal cortex (MPFC), could play a unique role in the way teens monitor these types of social evaluative contexts.

    The researchers had 69 participants, ranging in age from 8 to almost 23 years old, come to the lab and complete measures that gauged emotional, physiological, and neural responses to social evaluation.

    They told the participants that they would be testing a new video camera embedded in the head coil of a functional MRI scanner. The participants watched a screen indicating whether the camera was “off,” “warming up,” or “on”, and were told that a same-sex peer of about the same age would be watching the video feed and would be able to see them when the camera was on. In reality, there was no camera in the MRI machine.

    The consistency and strength of the resulting data took the researchers by surprise:

    “We were concerned about whether simply being looked at was a strong enough ‘social evaluation’ to evoke emotional, physiological and neural responses,” says Somerville. “Our findings suggest that being watched, and to some extent anticipating being watched, were sufficient to elicit self-conscious emotional responses at each level of measurement.

    Specifically, participants’ self-reported embarrassment, physiological arousal, and MPFC activation showed reactivity to social evaluation that seemed to converge and peak during adolescence.

    Adolescent participants also showed increased functional connectivity between the MPFC and striatum, an area of the brain that mediates motivated behaviors and actions. Somerville and colleagues speculate that the MPFC-striatum pathway may be a route by which social evaluative contexts influence behavior.

    The link may provide an initial clue as to why teens often engage in riskier behaviors when they’re with their peers.


  3. Study examines reasons for nostalgia

    by Ashley

    From the Carnegie Mellon University press release via HealthCanal:

    memory vanishingThe present often compares poorly to the past.

    When looking back on the movies, television shows, road trips and life more generally, we often perceive our past experiences as better than the same kinds of experiences we have today. These are known as “nostalgic preferences” — believing that past experiences were superior to their present counterparts.

    But was the past really better, or is this perception a trick that our minds play on us? New research at Carnegie Mellon University finds that the workings of memory seem to filter our view of the past with rose-colored glasses, biasing what we remember in ways that profoundly impact how we evaluate the past in comparison to the present.

    Carey K. Morewedge, associate professor of marketing and the BP Junior Faculty Chair at CMU’s Tepper School of Business, examined how memory biases create these nostalgic preferences over time by analyzing how people rate television shows and movies of the past and present in his research titled “It Was a Most Unusual time: How Memory Bias Engenders Nostalgic Preferences.” His study is in press at the Journal of Behavioral Decision Making.

    “Participants in the experiments exhibited nostalgic preferences for both movies and TV programs,” Morewedge said. “Films and shows from years past were consistently rated as having been better than the films and shows of the present. Moreover, the results of the experiments suggest that a bias in memory is responsible for these preferences.”

    Previous research has demonstrated that people show an asymmetry in what they remember of the past, in that they are quicker to forget negative rather than positive autobiographical memories, or personal past experiences. When it comes to films and television programs, for example, we readily remember our favorites of both the past and present, and all the bad films and shows of the present, but forget the bad films and shows of the past.

    Professor Morewedge’s research suggests that when we evaluate categories of experiences, we neglect to account for what we have forgotten. Thus, we base our judgment of the past on its best moments, but base our judgment of the present on all of its good and bad moments.

    Participants in the studies exhibited a tendency to recall movies and shows from both the past and present that were similarly good. When asked to recall any particular film or show, they most often remembered their favorite. However, participants also tended to evaluate all films and shows of the past based on the best examples they recalled, more so than in their evaluations of present offerings. This gave rise to their nostalgic preferences.

    Memory seems to operate much like a record store, stocking the hits of the past, and both the hits and the duds of the present. Rather than recognize this bias, however, we mistakenly believe that what we remember is representative of the entire category of experiences, giving rise to nostalgic preferences,” Morewedge explained.

    In addition to helping to explain our natural tendency to view the past as better than the present, these findings have useful implications for business and industry. Reminding people that past practices had as many (if not more) downsides than present practices may help employees learn to embrace a more diverse workforce and modern ways of working.

    These findings also can be useful to the entertainment industry, as it looks to recapture the positive perceptions that the public holds for older films and television programs. It also is a good lesson for marketing, brand and communications professionals who need to understand how their customer and audience’s perceptions change over time.


  4. Study suggests impulsivity may correlate with altruism in close relationships

    by Ashley

    From the Association for Psychological Science press release via ScienceDaily:

    support_friends_resiliencyWhen faced with the choice of sacrificing time and energy for a loved one or taking the self-centered route, people’s first impulse is to think of others, according to new research published in Psychological Science, a journal of the Association for Psychological Science.

    For decades psychologists have assumed that the first impulse is selfish and that it takes self-control to behave in a pro-social manner,” says lead researcher Francesca Righetti of VU University Amsterdam in the Netherlands. “We did not believe that this was true in every context, and especially not in close relationships.”

    Righetti and colleagues sought to examine whether impulsivity, in close relationships, might actually benefit others.

    They found that participants whose self-control was taxed (and were thus more impulsive) were more willing to sacrifice time and energy for their romantic partner or best friend than participants whose self-control wasn’t taxed.

    In one study, to find out whether they would sacrifice in actual practice, the researchers told couples they would have to talk to 12 strangers and ask them embarrassing questions. The participants didn’t know that they wouldn’t actually have to follow through with the task.

    Participants with high self-control opted to split the burden right down the middle — assigning six strangers to themselves and six strangers to their partner. But participants with low self-control opted to take on more of the burden, sacrificing their own comfort to spare their partners.

    A final experiment revealed that married individuals low in trait self-control sacrificed more for their partners, yet were also less forgiving of their transgressions — presumably because self-control is required to override the focus on the wrongdoing and think instead about the relationship as a whole.

    While sacrificing for a partner may help to build the relationship on a day-to-day basis, Righetti and colleagues note that it could backfire over the long-term, compromising individuals’ ability to maintain a balance between personal and relationship-related concerns.

    This balance is a perennial issue for anyone in a close relationship:

    “Whether it’s about which activities to engage in during free time, whose friends to go out with, or which city to live in, relationship partners often face a divergence of interests — what is most preferred by one partner is not preferred by the other,” notes Righetti.

    The field of research is relatively new, so the jury is still out on what effects sacrifice has on relationship well-being, but Righetti is hopeful that research over the next few years will shed more light on the link.

    Co-authors on this research include Catrin Finkenauer, also of VU University Amsterdam in the Netherlands, and Eli Finkel of Northwestern University.

    This research was supported by grants from the Netherlands Organization for Scientific Research.


  5. Study suggests winning sounds on slot machines reinforce feelings of reward

    July 8, 2013 by Ashley

    From the Springer press release via AlphaGalileo:

    gambling_slot_machineWinning sounds on slot machines make gambling more exciting, according to a new study by Mike Dixon and colleagues from the University of Waterloo in Canada. Moreover, their work shows that sounds also cause players to overestimate the number of times they won while playing on slot machines. The study is published online in Springer’s Journal of Gambling Studies.

    Sound has always been an integral part of the slot machine playing experience. Since the early 1900s, players have been rewarded with a ringing bell every time they have a winning combination. Today’s slot machines average about 400 sound effects.

    Modern slot machines allow players to wager on multiple lines. When they spin and lose, the machine goes quiet. When they spin and win more than their wager, they hear a celebratory song. Interestingly, when they spin and win back less than their wager (bet $1.00 and win back 20 cents) they still hear the celebratory songs despite the fact that overall they lost money on these spins. Dixon and colleagues sought to see if these celebratory sounds could hide the fact that players were losing money on these so-called ‘losses disguised as wins.’

    Dixon and team measured gamblers’ physiological responses to various slot machine game outcomes – wins, losses and losses disguised as wins – with and without sound during play. During slot machine play, palms may sweat, which increases skin conductance – a measure of arousal.

    A total of 96 gamblers played two sessions on a slot machine simulator. In one session, both wins and ‘losses disguised as wins’ were accompanied by rolling sounds and celebratory winning jingles, as well as visual feedback. In a second session, the sounds were turned off and players only received visual feedback. The researchers measured the participants’ skin conductance and heart rate responses to the various outcomes. At the end of play, the gamblers were asked which session they preferred and why. They also estimated how many spins they had won back more than they wagered.

    Sound influenced the overall levels of arousal of players. Skin conductance responses were significantly greater in the session with sound than in the session without sound. Players also rated the noisy session as more arousing than the quiet session. The majority of players preferred the playing session where wins were accompanied by sounds, which suggests that not only do sounds make playing more exciting, players enjoy this extra level of excitement.

    Sounds also contributed to players overestimating their number of wins. While this overestimation occurred both in the quiet and noisy sessions, it was significantly higher in the session with sound – 24 percent versus 15 percent in the session without sound. The authors suggest that sounds may be an integral part of ‘the disguise’ in losses disguised as wins, causing players to think that they have won more often during a playtime session than they actually have.

    The authors conclude: “Although sounds may have contributed to players’ enjoyment of the game, sound may also lead to an overestimation of winning. Both of these effects may contribute to gambling problems, such as misbeliefs about the true chances of winning, and persistence that some players experience when playing slot machines.


  6. Study suggests physical environment may affect likelihood of dishonest behaviour

    by Ashley

    From the Columbia Business School press release via HealthCanal:

    hispanic_bossA new study from researchers at leading business schools reveals that expansive physical settings (e.g. having a big desk to stretch out while doing work or a large driver’s seat in an automobile) can cause individuals to feel more powerful, and in turn these feelings of power can elicit more dishonest behavior such as stealing, cheating, and even traffic violations.

    “In everyday working and living environments, our body postures are incidentally expanded and contracted by our surroundings — by the seats in our cars, the furniture in and around workspaces, even the hallways in our offices — and these environments directly influence the propensity of dishonest behavior in our everyday lives,” said Andy Yap, a key author of the research who spearheaded its development during his time at Columbia Business School.

    The study states that while individuals may pay very little attention to ordinary and seemingly innocuous shifts in bodily posture, these subtle postural shifts can have tremendous impact on our thoughts, feelings and behavior. Building on previous research that expansive postures can lead to a state of power, and power can lead to dishonest behavior, the study found that expanded, nonverbal postures forced upon individuals by their environments could influence decisions and behaviors in ways that render people less honest.

    “This is a real concern. Our research shows that office managers should pay attention to the ergonomics of their workspaces. The results suggest that these physical spaces have tangible and real-world impact on our behaviors,” said Andy Yap.

    The research includes findings from four studies conducted in the field and the laboratory. One study manipulated the expansiveness of workspaces in the lab and tested whether “incidentally” expanded bodies (shaped organically by one’s environment) led to more dishonesty on a test (see Figure 1). Another experiment examined if participants in a more expansive driver’s seat would be more likely to “hit and run” when incentivized to go fast in a video–game driving simulation (see Figure 2).

    To extend results to a real–world context, an observational field study tested the ecological validity of the effect by examining whether automobile drivers’ seat size predicted the violation of parking laws in New York City. The field study revealed that automobiles with more expansive driver’s seats were more likely to be illegally parked on New York City streets.

    The research, titled The Ergonomics of Dishonesty, will be published in a forthcoming issue of the journal Psychological Science. It is co–authored by Andy Yap, a former PhD student at Columbia Business School and currently a visiting professor at MIT Sloan School of Management; Abbie Wazlawek, a PhD student at Columbia Business School; Brian Lucas, a PhD student at Kellogg School of Management; Amy Cuddy, a professor at Harvard Business School; and Dana Carney, a professor at the University of California, Berkeley.


  7. Study suggests giving children non-verbal clues about words boosts vocabularies

    by Ashley

    From the University of Chicago press release via MedicalXpress:

    studying problemsThe clues that parents give toddlers about words can make a big difference in how deep their vocabularies are when they enter school, new research at the University of Chicago shows.

    By using words to reference objects in the visual environment, parents can help young children learn new words, according to the research. It also explores the difficult-to-measure quality of non-verbal clues to word meaning during interactions between parents and children learning to speak. For example, saying, “There goes the zebra” while visiting the zoo helps a child learn the word “zebra” faster than saying, “Let’s go to see the zebra.”

    Differences in the quality of parents’ non-verbal clues to toddlers (what children can see when their parents are talking) explain about a quarter (22 percent) of the differences in those same children’s vocabularies when they enter kindergarten, researchers found. The results are reported in the paper, “Quality of early parent input predicts child vocabulary three years later,” published in the current issue of the Proceedings of the National Academy of Sciences.

    “Children’s vocabularies vary greatly in size by the time they enter school,” said lead author Erica Cartmill, a postdoctoral scholar at UChicago. “Because preschool vocabulary is a major predictor of subsequent school success, this variability must be taken seriously and its sources understood.”

    Scholars have found that the number of words youngsters hear greatly influences their vocabularies. Parents with higher socioeconomic status—those with higher income and more education—typically talk more to their children and accordingly boost their vocabularies, research has shown.

    That advantage for higher-income families doesn’t show up in the quality research, however.

    “What was surprising in this study was that social economic status did not have an impact on quality. Parents of lower social economic status were just as likely to provide high-quality experiences for their children as were parents of higher status,” said co-author Susan Goldin-Meadow, the Beardsley Ruml Distinguished Service Professor in Psychology at UChicago.

    Although scholars have amassed impressive evidence that the number of words children hear—the quantity of their linguistic input—has an impact on vocabulary development, measuring the quality of the verbal environment—including non-verbal clues to word meaning—has proved much more difficult.

    To measure quality, the research team reviewed videotapes of everyday interactions between 50 primary caregivers, almost all mothers, and their children (14 to 18 months old). The mothers and children, from a range of social and economic backgrounds, were taped for 90-minute periods as they went about their days, playing and engaging in other activities.

    The team then showed 40-second vignettes from these videotapes to 218 adults with the sound track muted. Based on the interaction between the child and parent, the adults were asked to guess what word the parent in each vignette used when a beep was sounded on the tape.

    A beep might occur, for instance, in a parent’s silenced speech for the word “book” as a child approaches a bookshelf or brings a book to the mother to start storytime. In this scenario, the word was easy to guess because the mother labeled objects as the child saw and experienced them. In other tapes, viewers were unable to guess the word that was beeped during the conversation, as there were few immediate clues to the meaning of the parent’s words. Vignettes containing words that were easy to guess provided high-quality clues to word meaning.

    Although there were no differences in the quality of the interactions based on parents’ backgrounds, the team did find significant individual differences among the parents studied. Some parents provided non-verbal clues about words only 5 percent of the time, while others provided clues 38 percent of the time, the study found.

    The study also found that the number of words parents used was not related to the quality of the verbal exchanges.

    Early quantity and quality accounted for different aspects of the variance found in the later vocabulary outcome measure,” the authors wrote. In other words, how much parents talk to their children (quantity), and how parents use words in relation to the non-verbal environment (quality) provided different kinds of input into early language development.

    “However, parents who talk more are, by definition, offering their children more words, and the more words a child hears, the more likely it will be for that child to hear a particular word in a high-quality learning situation,” they added. This suggests that higher-income families’ vocabulary advantage comes from a greater quantity of input, which leads to a greater number of high-quality word-learning opportunities. Making effective use of non-verbal cues may be a good way for parents to get their children started on the road to language.

    Joining Cartmill and Goldin-Meadow as authors were University of Pennsylvania scholars Lila Gleitman, professor emerita of psychology; John Trueswell, professor of psychology; Benjamin Armstrong, a research assistant; and Tamara Medina, assistant professor of psychology at Drexel University.


  8. Study examines toddlers’ visual working memory

    July 7, 2013 by Ashley

    From the University of Iowa press release via ScienceDaily:

    child frustrationWhen young children gaze intently at something or furrow their brows in concentration, you know their minds are busily at work. But you’re never entirely sure what they’re thinking.

    Now you can get an inside look. Psychologists led by the University of Iowa for the first time have peered inside the brain with optical neuroimaging to quantify how much 3- and 4-year-old children are grasping when they survey what’s around them and to learn what areas of the brain are in play.

    The study looks at “visual working memory,” a core cognitive function in which we stitch together what we see at any given point in time to help focus attention. In a series of object-matching tests, the researchers found that 3-year-olds can hold a maximum of 1.3 objects in visual working memory, while 4-year-olds reach capacity at 1.8 objects. By comparison, adults max out at 3 to 4 objects, according to prior studies.

    “This is literally the first look into a 3 and 4-year-old’s brain in action in this particular working memory task,” says John Spencer, psychology professor at the UI and corresponding author of the paper, which appears in the journal NeuroImage.

    The research is important, because visual working memory performance has been linked to a variety of childhood disorders, including attention-deficit/hyperactivity disorder (ADHD), autism, developmental coordination disorder as well as affecting children born prematurely. The goal is to use the new brain imaging technique to detect these disorders before they manifest themselves in children’s behavior later on.

    “At a young age, children may behave the same,” notes Spencer, who’s also affiliated with the Delta Center and whose department is part of the College of Liberal Arts and Sciences, “but if you can distinguish these problems in the brain, then it’s possible to intervene early and get children on a more standard trajectory.”

    Plenty of research has gone into better understanding visual working memory in children and adults. Those prior studies divined neural networks in action using function magnetic resonance imaging (fMRI). That worked great for adults, but not so much with children,­ especially young ones, whose jerky movements threw the machine’s readings off kilter. So, Spencer and his team turned to functional near-infrared spectroscopy (fNIRS), which has been around since the 1960s but has never been used to look at working memory in children as young as three years of age.

    “It’s not a scary environment,” says Spencer of the fNIRS. “No tube, no loud noises. You just have to wear a cap.”

    Like fMRI, fNIRS records neural activity by measuring the difference in oxygenated blood concentrations anywhere in the brain. You’ve likely seen similar technology when a nurse puts your finger in a clip to check your circulation. In the brain, when a region is activated, neurons fire like mad, gobbling up oxygen provided in the blood. Those neurons need another shipment of oxygen-rich blood to arrive to keep going. The fNIRS measures the contrast between oxygen-rich and oxygen-deprived blood to gauge which area of the brain is going full tilt at a point in time.

    The researchers outfitted the youngsters with colorful, comfortable ski hats in which fiber optic wires had been woven. The children played a computer game in which they were shown a card with one to three objects of different shapes for two seconds. After a pause of a second, the children were shown a card with either the same or different shapes. They responded whether they had seen a match.

    The tests revealed novel insights. First, neural activity in the right frontal cortex was an important barometer of higher visual working memory capacity in both age groups. This could help clinicians evaluate children’s visual working memory at a younger age than before, and work with those whose capacity falls below the norm, the researchers say.

    Secondly, 4-year olds showed a greater use than 3-year olds of the parietal cortex, located in both hemispheres below the crown of the head and which is believed to guide spatial attention.

    This suggests that improvements in performance are accompanied by increases in the neural response,” adds Aaron Buss, a UI graduate student in psychology and the first author on the paper. “Further work will be needed to explain exactly how the neural response increases — either through changes in local tuning, or through changes in long range connectivity, or some combination.”

    Contributing authors include David Boas from Massachusetts General Hospital and Harvard Medical School and Nicholas Fox, research assistant at the UI.

    The National Institutes of Health (grant number: P41 14075) funded the research through a grant to Boas. Other funding came from the UI’s funding of the Delta Center’s Child Imaging Laboratory in Development Science (CHILDS) facility. This is the first study from data collected from the CHILDS facility.


  9. Study suggests people prefer carrots to sticks when it comes to healthcare incentives

    by Ashley

    From the Association for Psychological Science press release via HealthCanal:

    health claim formTo keep costs low, companies often incentivize healthy lifestyles. Now, new research suggests that how these incentives are framed — as benefits for healthy-weight people or penalties for overweight people — makes a big difference.

    The research, published in Psychological Science, a journal of the Association for Psychological Science, shows that policies that carry higher premiums for overweight individuals are perceived as punishing and stigmatizing.

    Researcher David Tannenbaum of the Anderson School of Management at the University of California, Los Angeles wanted to investigate how framing healthcare incentives might influence people’s attitudes toward the incentives.

    Two frames that are logically equivalent can communicate qualitatively different messages,” Tannenbaum explains.

    In the first study, 126 participants read about a fictional company grappling with managing their employee health-care policy. They were told that the company was facing rising healthcare costs, due in part to an increasing percentage of overweight employees, and were shown one of four final policy decisions.

    The “carrot” plan gave a $500 premium reduction to healthy-weight people, while the “stick” plan increased premiums for overweight people by $500. The two plans were functionally equivalent, structured such that healthy-weight employees always paid $2000 per year in healthcare costs, and overweight employees always paid $2500 per year in healthcare costs.

    There were also two additional “stick” plans that resulted in a $2400 premium for overweight people.

    Participants were more likely to see the “stick” plans as punishment for being overweight and were less likely to endorse them.

    But they didn’t appear to differentiate between the three “stick” plans despite the $100 premium difference. Instead, they seemed to evaluate the plans on moral grounds, deciding that punishing someone for being overweight was wrong regardless of the potential savings to be had.

    The data showed that framing incentives in terms of penalties may have particular psychological consequences for affected individuals: People with higher body mass index (BMI) scores reported that they would feel particularly stigmatized and dissatisfied with their employer under the three “stick” plans.

    Another study placed participants in the decision maker’s seat to see if “stick” and “carrot” plans actually reflected different underlying attitudes. Participants who showed high levels of bias against overweight people were more likely to choose the “stick” plan, but provided different justification depending on whether their bias was explicit or implicit:

    Participants who explicitly disliked overweight people were forthcoming about their decision, admitting that they chose a ‘stick’ policy on the basis of personal attitudes,” noted Tannenbaum. “Participants who implicitly disliked overweight people, in contrast, justified their decisions based on the most economical course of action.”

    Ironically, if they were truly focused on economic concerns they should have opted for the “carrot” plan, since it would save the company $100 per employee. Instead, these participants tended to choose the strategy that effectively punished overweight people, even in instances when the “stick” policy implied a financial cost to the company.

    Tannenbaum concludes that these framing effects may have important consequences across many different real-world domains:

    In a broad sense, our research affects policymakers at large,” says Tannenbaum. “Logically equivalent policies in various domains — such as setting a default option for organ donation or retirement savings — can communicate very different messages, and understanding the nature of these messages could help policymakers craft more effective policy.”

    Co-authors on this research include Chad Valasek of the University of California, San Diego; Eric Knowles of New York University; and Peter Ditto of the University of California, Irvine.


  10. Study examines social capabilities of performing multiple-action sequences

    by Ashley

    From the Rutgers University press release via MedicalXpress:

    elderly_hands_caneThe day of the big barbecue arrives and it’s time to fire up the grill. But rather than toss the hamburgers and hotdogs haphazardly onto the grate, you wait for the heat to reach an optimal temperature, and then neatly lay them out in their apportioned areas according to size and cooking times.

    Meanwhile, your friend is preparing the beverages. Cups are grabbed face down from the stack, turned over, and – using the other hand – filled with ice.

    While these tasks – like countless, everyday actions – may seem trivial at first glance, they are actually fairly complex, according to Robrecht van der Wel, an assistant professor of psychology at Rutgers–Camden. “For instance, the observation that you grab a glass differently when you are filling a beverage than when you are stacking glasses suggests that you are thinking about the goal that you want to achieve,” he says. “How do you manipulate the glass? How do you coordinate your actions so that the liquid goes into the cup? These kinds of actions are not just our only way to accomplish our intentions, but they reveal our intentions and mental states as well.”

    van der Wel and his research partners, Marlene Meyer and Sabine Hunnius, turned their attention to how action planning generalizes to collaborative actions performed with others in a study, titled Higher-order planning for individual and joint object manipulations, published recently in Experimental Brain Research.

    According to van der Wel, the researchers were especially interested in determining whether people’s actions exhibit certain social capabilities when performing multiple-action sequences in concert with a partner. “It is a pretty astonishing ability that we, as people, are able to plan and coordinate our actions with others,” says van der Wel. “If people plan ahead for themselves, what happens if they are now in a task where their action might influence another person’s comfort? Do they actually take that into account or not, even though, for their personal action, it makes no difference?”

    In the research study, participants first completed a series of individual tasks requiring them to pick up a cylindrical object with one hand, pass it to their other hand, and then place it on a shelf. In the collaborative tasks, individuals picked up the object and handed it to their partner, who placed it on the shelf. The researchers varied the height of the shelf, to test whether people altered their grasps to avoid uncomfortable end postures. The object could only be grasped at one of two positions, implying that the first grasp would determine the postures – and comfort – of the remaining actions.

    According to the researchers, the results from both the individual and joint performances show that participants altered their grasp location relative to the height of the shelf. The participants in both scenarios were thus more likely to use a low-grasp location when the shelf was low, and vice versa. Doing so implied that the participants ended the sequences in comfortable postures. The researchers conclude that, in both individual and collaborative scenarios, participants engaged in extended planning to finish the object-transport sequences in a relatively comfortable posture. Given that participants did plan ahead for the sake of their action partner, it indicates an implicit social awareness that supports collaboration across individuals.

    van der Wel notes that, while such basic actions may seem insignificant, it is important to understand how people perform basic tasks such as manipulating objects when considering those populations that aren’t able to complete them so efficiently. “How to pick up an object seems like a really trivial problem when you look at healthy adults, but as soon as you look at children, or people suffering from a stroke, it takes some time to develop that skill properly,” says van der Wel.

    When someone has a stroke, it is not that they have damage to the musculature involved in doing the task; rather, damage to action planning areas in the brain results in an inability to perform simple actions. A better understanding of the mechanisms involved in action planning may guide rehabilitation strategies in such cases.”

    According to van der Wel, the researchers are currently working on modifying the task to determine the age at which children begin planning their actions with respect to other peoples’ comfort. In particular, they want to understand how the development of social action planning links with the development of other cognitive and social abilities.