Decision Science News

Columbia Business School study finds that the majority of consumers are loss averse, but results vary by age, education level and financial experience

From October 17 to October 20 three members of CDS, Kellen Mrkva, Atonia Krefeld-Schwalb, and Byung Cheol Lee, traveled to Atlanta to attend the 2019 Association for Consumer Research Conference (ACR). All three organized special sessions around their research.

Defaults are one of applied behavioral science’s biggest success stories. Despite, or perhaps because of, the widespread use and success of defaults, a few important questions have remained in the background: How have defaults been implemented? Does it matter how they are implemented? This was the aim of a recent meta-analysis of all prior default studies conductd by the Center for Decision Sciences, which we recently published in Behavioural Public Policy (authors Jon Jachimowicz, Shannon Duncan, Elke Weber and Eric Johnson). 

The number 1 rule for long-term individual investors picking funds used to be simple: look for low fees, also known as low expense ratios. Investors do get rewards from low fees; but they should also watch out for higher, hidden fees in the same funds, as well as strategies that lure investors into higher-priced products or into paying more for advice. Instead of asking about low fees alone, ask what you are paying over 10 years, including all fees. "What is the cost, all in, for 10 years?" said Eric Johnson, Director of the Center for Decision Sciences.

CDS director Eric Johnson talks with Deal Crunch about the research that the center does on consumer decisions.

CDS director Eric Johnson discusses bait-and-switch airline fares.

Transportation contributes approximately 26 percent to greenhouse gas emissions. As a result, governments around the world are looking for ways to increase consumers’ use of fuel-efficient vehicles. One of the most straightforward ways to provide this information is in the form of labels.

More than 1.5 billion people live in extreme poverty worldwide, and even in the relatively wealthy US, 14 per cent live below the poverty line. People in poverty make more “myopic” or short-term decisions rather than forward-looking decisions that could improve their situations. A new study co-authored at Cambridge Judge Business School finds that increased community trust could help halt this “vicious cycle” of poverty.

Do cuts in President Donald Trump’s proposed budget hurt women more than men? Advocates for women’s issues say yes.