Regret and disappointment in taxpayer reporting decisions: An experimental study

Abstract

This paper reports on experiments which test whether factors such as regret or disappointment influence taxpayer compliance decisions. Previous tests of regret and disappointment theory have been based upon the common-ratio effect in which probabilities vary while outcomes are held fixed. In contrast, our experiments involved trials in which the outcomes were allowed to vary. Previous tests had mainly found evidence of regret effects and to a lesser extent were supportive of disappointment. In contrast, we were able to reject simple theories of both regret and disappointment. A second experiment produced evidence which indicates that whether or not rejected risky alternatives are resolved has no significant influence on subjects' choices. One would expect that regret could only occur when a subject learns the outcome of a non-chosen option. Hence this result can be seen as evidence against regret theory. We shall argue that there is a possible interpretation of regret theory which is compatible with this result.

Augmenting the Theory of Planned Behavior: Roles for Anticipated Regret and Descriptive Norms1

“…First, in Studies 1 and 2, anticipated regret dealt with a different behavior (failing to play the lottery) than did attitudes, subjective norms, and PBC (playing the lottery). While the original formulation of regret theory stresses the motivational impact of regretting the nonchosen action (e.g., Kelsey & Schepanski, 1991), it is possible that different findings might have been obtained if we had measured anticipated regret with respect to playing the lottery.5 Second, Studies 1 and 2 both concerned intentions to play the lottery, rather than actual behavior. In order to address both of these issues, we conducted a third study.…”

Neurobiological regret and rejoice functions for aversive outcomes

“…Choose poorly and regret it; choose wisely and rejoice. The most common formulation of regret and rejoice is as a result of counterfactual thinking, in which a realized outcome is compared with, "what might have been" (Boles and Messick, 1995;Inman et al, 1997;Kelsey and Schepanski, 1991;Mellers, 2000;Ritov and Baron, 1995;Roese and Olson, 1995;Zeelenberg, 1999). Although a growing body of experimental work supports the existence of the commonsense notions of regret and rejoice, a number of questions remain as to how such a comparative algorithm is implemented both cognitively and neurobiologically in the brain.…”

Anticipated regret, expected feedback and behavioral decision making

“…Recently it has been suggested that these eects might not be caused by the juxtaposition of the outcomes, but rather by event splitting, increased weighting of consequences when they are split into two subevents than when it is considered as a single event (see, for details, Starmer and Sugden, 1993). Also other research aimed at directly testing predictions from regret theory did not provide unequivocal support (see Harless, 1992;Di Cagnio and Hey, 1988;Kelsey and Schepanski, 1991;Leland, 1998). Despite the mixed success of regret theory, there is some support for the broader claim underlying the theory, that people take regret into account when making decisions.…”