There are Free Lunches Statement of Intentions
There are Free Lunches: Behavioral Clues to Live Happy in the Economic World is a blog that intends to present updated and relevant information about the "hidden" and only recently uncovered dimensions of the economic science: the behavioral factors. With this blog we intend to promote in Europe and in the rest of the World, the top research articles and perspectives on behavioral economics, decision making, consumer behavior, and general behavioral science. We aim to be followed by journalists, academics, managers, civil servants, and everyone who wishes to improve their daily interaction with the economic world and consequently, their lives' happiness.
Thursday, 28 April 2011
Principle 3: Buy Many Small Pleasures Instead of Few Big Ones
Across many different life domains, happiness is more strongly associated with the frequency than the intensity of people’s positive affective experiences. No one finds it surprising that people who have sex are happier than people who don’t, but some do find it surprising that the optimal number of sexual partners to have in a twelve-month period is one. Why would people who have one partner be happier than people who have many? One reason is that multiple partners are occasionally thrilling, but regular partners are regularly enjoyable. A bi-weekly ride on a merry-go-round may be better than an annual ride on a roller coaster. One reason why small frequent pleasures beat infrequent large ones is that we are less likely to adapt to the former. The more easily people can understand and explain an event, the quicker they adapt to it, and thus anything that makes a pleasurable event more difficult to understand and explain will delay adaptation. These variables include novelty (we’ve never experienced the event before), surprise (we didn’t expect it to happen), uncertainty (we’re not entirely sure what the event is), and variability (the event keeps changing). Having a beer after work with friends, for example, is never exactly the same as it was before. If we buy an expensive dining room table, on the other hand, it’s pretty much the same table today as it was last week. Because frequent small pleasures are different each time they occur, they forestall adaptation. Another advantage of small pleasures is that they are less susceptible to diminishing marginal utility, which refers to the fact that each unit increase in the magnitude of a pleasure increases the hedonic impact of that pleasure by a smaller amount than did the previous unit increase. Eating a 12 ounce cookie is not twice as pleasurable as eating a 6 ounce cookie because the first X% of a cookie’s weight accounts for more than X% of its hedonic impact. People can therefore offset diminishing marginal utility by “breaking up” or “segregating” a pleasurable experience such as cookie-eating into a series of briefer experiences. Eating two 6 ounce cookies on different days may be better than eating a 12 ounce cookie at a single sitting. But why does segregation work? One reason is that it introduces a temporal discontinuity between experiences and thus ameliorates the effects of adaptation. Researchers asked participants to sit in a chair equipped with a massage cushion. Half the participants experienced a continuous 180 second massage, while the others experienced a massage of 80 seconds, followed by a 20 second break, followed by a another 80 second massage. Compared to participants who experienced one longer massage, those who experienced two briefer massages (interrupted by a break) found the overall experience more pleasurable and were willing to pay about twice as much to purchase the massage cushion. Before the massage began, however, the majority of participants made affective forecasting errors: they predicted that they would prefer receiving one continuous massage rather than two shorter massages with a break in the middle. The happiness provided by frequent small pleasures helps make sense of the modest correlation between money and happiness. In a study of Belgian adults, individuals who had a strong capacity to savor the mundane joys of daily life were happier than those who did not. This capacity to savor, however, was reduced among wealthy individuals. The positive impact of wealth on happiness was significantly undercut by the negative impact of wealth on savoring. Indeed, when participants are exposed to photographs of money (thereby priming the construct of wealth) they spend significantly less time eating a piece of chocolate and exhibit less pleasure while doing it. In short, not only are the small pleasures of daily life an important source of happiness, but unfettered access to peak experiences may actually be counterproductive.