The lesser of two evils: Explaining a bad choice by revealing the choice set

Abstract

Making the right choice sometimes involves selecting the "lesser of two evils," and only seeing the chosen option can lead others to misunderstand the decision maker's intentions.Are decision-makers intrinsically driven to fix this misjudgment by revealing the choice set? If so, why, and what is the effect on the audience? Previous studies could not examine this desire to be understood because the research designs did not isolate the decision to reveal information from the original choice. In two experiments (N=448 pairs), we show that people are willing to pay ex post to reveal their choice set to the recipient, even after a one-shot anonymous interaction with no reputational consequences, and in some cases even when doing so reveals their selfish intentions. We find that this revealing behavior is effective at improving recipients' rating of their outcome when it signals generous intentions, but not when it signals selfish intentions. The choice to reveal is driven by concern for the beliefs of strangers, but only when revealing signals generous intentions; those who reveal a choice that appears selfish report doing so out of a desire to be or appear honest. And though some people leave a misunderstanding in place when it is self-enhancing to do so, almost no one is willing to create a misunderstanding (by hiding the other option), even when it could conceal selfish behavior. (226 words) JEL classification C91, D64, D82, D83, D84