Context Dependence in Speed Dating

For quite some time, it has been known that how we perceive an object depends not just on its own objective qualities, but also on those of surrounding objects. In this paper, I draw on a speed dating experiment to show that such context dependence is not restricted to the domain of perception, but carries over to behavior. I also shed light on the mechanism through which context dependence operates.

Abstract

Context influences decision making. However, evidence on the specific underlying mechanism is scarce. Since context dependence in decision making may impact consumers, firms and political agenda setters, exploring the precise mechanism through which choices are distorted is imperative. This paper provides evidence that expanding the utility range of one choice dimension leads decision makers to attach less weight to this attribute, in line with the notion of relative thinking (Bushong et al., 2016). Context dependence is more pronounced if evaluators are female and survives extensive robustness checks. Implications for policy are discussed.