David Laibson mentioned how if you give people randomly assigned health care, and then give them the options to change two weeks later, they tend not to. Sendhil Mullainathan mentioned how health care providers systematically recommend the same plan no matter what medical history the caller (a senior citizen) had and no matter what cocktail of medicines (s)he was on. Thoughts?
Tags: fact free learning, health care, heuristics, methodology, neuroeconomics, new methodsWe present a model of coarse thinking, in which individuals group situations into categories, and transfer the informational content of a given message from situations in a category where it is useful to those where it is not. The model explains how uninformative messages can be persuasive, particularly in low involvement situations, and how objectively informative messages can be dropped by the persuader without the audience assuming the worst. The model sheds light on product branding, the structure of product attributes, and several puzzling aspects of mutual fund advertising.
The abstract of Sendhil Mullainathan, Joshua Schwartzstein, and Andrei Schleifer’s recent paper entitled Coarse Thinking and Persuasion.
The paper produces some comforting results:
The model sheds light on a number of phenomena. Most importantly, it explains how uninformative persuasion can be effective, especially in low involvement situations, such as evaluating cheap goods or political candidates. The model also helps understand the pervasive phenomenon of persuaders’ omitting bad payoff-relevant news from their messages. Both uninformative persuasion and omission of data are possible in our model even if the audience takes into account the strategy of the persuader.
Hopefully heuristics and persuasion literature will become more popular in coming years.
Tags: heuristics, persuasion