A valence asymmetry in predecisional distortion of information: Evidence from an eye tracking study with incentivized choices.

Abstract

Existing research shows that the order in which evidence arrives can bias its evaluation and the resulting decision in favor of information encountered early on. We used eye-tracking to study the underlying cognitive mechanisms in the context of incentivized financial choices based on real world market data. Subjects learned about the presence/absence of a transaction fee, before seeing expert opinions regarding an investment prospect and deciding whether to invest. Although the fee had no effect on the processing of negative opinions, we found that positive ones were processed more effortlessly (with lower gaze duration and pupil dilation) when it was absent, i.e. when they were congruent with the positive initial information in the shape of the lack of fees. Despite their more effortless processing in the absence of fees, positive opinions then had a greater impact on the subjects' beliefs. In addition to an initial study with N=100 subjects, these findings were replicated in a second, pre-registered experiment with N=103 subjects, in which a positive premium was paid in the event of no fee. Thus, we argue that the valence asymmetry in favor of positive information observed in evaluative priming, person perception, and related tasks (the 'density hypothesis') also plays a crucial role in incentivized economic choice. In fact, rather than being a detrimental bias, the overweighting of initial evidence often observed in decisions could be seen as an adaptive heuristic aimed at reducing the cost of processing later, similar information.

Eye movement anomalies as a source of diagnostic information in decision process analysis.

“…In particular, an alternative to our “Waddington landscape” intuition might be that having more information increases the cognitive load, making subsequent top-down control of attention harder, more imprecise, and the scanpaths more irregular. This explanation would be consistent with the fact that scanpaths are more idiosyncratic after a negative than after a positive disclosure, as we previously found that negative early information increases the subsequent cognitive effort (M. Król & Król, 2019c).…”

“…This was further adjusted by a random amount independent of the return: either ϩ15 ("positive adjustment") or Ϫ25 ("negative adjustment"). These values were set vis-a `-vis the mean return of ϩ37, based on previous experiments with similarly designed stimuli (M. Król & Król, 2019c), so that disclosing the adjustment beforehand would not make either investing or refraining the obvious choice, discouraging from examining opinions (that is, there was still a small riskpremium under a negative adjustment, but the positive one was small enough so as not to induce people to invest regardless of the opinion words).…”

Gazing through the bubble: an experimental investigation into financial risk-taking using eye-tracking

“…For example, Hinvest et al (2018) addressed the conflict between investment and social preferences and determined that it was possible to nudge and classify investors using images related to social behavior and negative social images, eliciting a stronger effect than positive ones. Król and Król (2019a) found that the initial positive information shown to subjects in a stock trading experiment facilitates the elaboration of further positive information; this effect is not present for negative information. As such, positive information has a stronger effect on participants' decisions.…”