With the expensive part of the Hallowthankmas season now approaching, a question must be looming large in our readers’ minds:

“Dear Overcoming Bias, are there biases I can exploit to be seen as generous without actually spending lots of money?”

I’m glad to report the answer is yes! According to Hsee—in a paper entitled “Less is Better”—if you buy someone a $45 scarf, you are more likely to be seen as generous than if you buy them a $55 coat.¹

This is a special case of a more general phenomenon. In an earlier experiment, Hsee asked subjects how much they would be willing to pay for a second-hand music dictionary:²

Dictionary A, from 1993, with 10,000 entries, in like-new condition.
Dictionary B, from 1993, with 20,000 entries, with a torn cover and otherwise in like-new condition.

The gotcha was that some subjects saw both dictionaries side-by-side, while other subjects only saw one dictionary . . .

Subjects who saw only one of these options were willing to pay an average of $24 for Dictionary A and an average of $20 for Dictionary B. Subjects who saw both options, side-by-side, were willing to pay $27 for Dictionary B and $19 for Dictionary A.

Of course, the number of entries in a dictionary is more important than whether it has a torn cover, at least if you ever plan on using it for anything. But if you’re only presented with a single dictionary, and it has 20,000 entries, the number 20,000 doesn’t mean very much. Is it a little? A lot? Who knows? It’s non-evaluable. The torn cover, on the other hand—that stands out. That has a definite affective valence: namely, bad.

Seen side-by-side, though, the number of entries goes from non-evaluable to evaluable, because there are two compatible quantities to be compared. And once the number of entries becomes evaluable, that facet swamps the importance of the torn cover.

From Slovic et al.: Which would you prefer?³

A 29/36 chance to win $2.
A 7/36 chance to win $9.

While the average prices (equivalence values) placed on these options were $1.25 and $2.11 respectively, their mean attractiveness ratings were 13.2 and 7.5. Both the prices and the attractiveness rating were elicited in a context where subjects were told that two gambles would be randomly selected from those rated, and they would play the gamble with the higher price or higher attractiveness rating. (Subjects had a motive to rate gambles as more attractive, or ...

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