Limits...
Introducing conjoint analysis method into delayed lotteries studies: its validity and time stability are higher than in adjusting.

Białek M, Markiewicz Ł, Sawicki P - Front Psychol (2015)

Bottom Line: A set of two studies compared the conjoint analysis with adjusting.The results suggest that individual parameters of discounting strength estimated with conjoint have higher predictive value (Study 1 and 2), and they are more stable over time (Study 2) compared to adjusting.We discuss these findings, despite the exploratory character of reported studies, by suggesting that future research on delayed lotteries should be cross-validated using both methods.

View Article: PubMed Central - PubMed

Affiliation: Economic Psychology Department, Centre for Economic Psychology and Decision Sciences, Kozminski University Warsaw, Poland.

ABSTRACT
The delayed lotteries are much more common in everyday life than are pure lotteries. Usually, we need to wait to find out the outcome of the risky decision (e.g., investing in a stock market, engaging in a relationship). However, most research has studied the time discounting and probability discounting in isolation using the methodologies designed specifically to track changes in one parameter. Most commonly used method is adjusting, but its reported validity and time stability in research on discounting are suboptimal. The goal of this study was to introduce the novel method for analyzing delayed lotteries-conjoint analysis-which hypothetically is more suitable for analyzing individual preferences in this area. A set of two studies compared the conjoint analysis with adjusting. The results suggest that individual parameters of discounting strength estimated with conjoint have higher predictive value (Study 1 and 2), and they are more stable over time (Study 2) compared to adjusting. We discuss these findings, despite the exploratory character of reported studies, by suggesting that future research on delayed lotteries should be cross-validated using both methods.

No MeSH data available.


Area under the curve for hypothetical three delayed lotteries (0.01;0.1;0.7).
© Copyright Policy - open-access
Related In: Results  -  Collection

License
getmorefigures.php?uid=PMC4309168&req=5

Figure 1: Area under the curve for hypothetical three delayed lotteries (0.01;0.1;0.7).

Mentions: In adjusting procedure the participants choose one alternative among two presented on the screen. Individuals choose one of two cards according to their preferences. The delayed and uncertain amount is constant, whereas the immediate and certain alternative change their value based on individuals' consecutive choices. If the participants choose the delayed lottery, the alternative increases (usually) by half of its previous value. To illustrate this procedure, let us follow an example: the presented set consists of two possible gains: (a) $5.000 in 6 months with 0.3 probability and (b) $2.500 now and certain. If the participant chose the immediate offer, it decreases by half of its previous value (to $1.250), but if he chose the delayed and uncertain alternative, the certain and immediate alternative rises (to increase its attractiveness) to $3.750. After making predefined number of steps, the indifference point is calculated (a mean of the two last certain and immediate alternatives). The indifference point is a subjective equivalent of the delayed lottery. The set of indifference points assigned to each postponement periods forms a discounting curve—separate for each researched lottery (Figure 1).


Introducing conjoint analysis method into delayed lotteries studies: its validity and time stability are higher than in adjusting.

Białek M, Markiewicz Ł, Sawicki P - Front Psychol (2015)

Area under the curve for hypothetical three delayed lotteries (0.01;0.1;0.7).
© Copyright Policy - open-access
Related In: Results  -  Collection

License
Show All Figures
getmorefigures.php?uid=PMC4309168&req=5

Figure 1: Area under the curve for hypothetical three delayed lotteries (0.01;0.1;0.7).
Mentions: In adjusting procedure the participants choose one alternative among two presented on the screen. Individuals choose one of two cards according to their preferences. The delayed and uncertain amount is constant, whereas the immediate and certain alternative change their value based on individuals' consecutive choices. If the participants choose the delayed lottery, the alternative increases (usually) by half of its previous value. To illustrate this procedure, let us follow an example: the presented set consists of two possible gains: (a) $5.000 in 6 months with 0.3 probability and (b) $2.500 now and certain. If the participant chose the immediate offer, it decreases by half of its previous value (to $1.250), but if he chose the delayed and uncertain alternative, the certain and immediate alternative rises (to increase its attractiveness) to $3.750. After making predefined number of steps, the indifference point is calculated (a mean of the two last certain and immediate alternatives). The indifference point is a subjective equivalent of the delayed lottery. The set of indifference points assigned to each postponement periods forms a discounting curve—separate for each researched lottery (Figure 1).

Bottom Line: A set of two studies compared the conjoint analysis with adjusting.The results suggest that individual parameters of discounting strength estimated with conjoint have higher predictive value (Study 1 and 2), and they are more stable over time (Study 2) compared to adjusting.We discuss these findings, despite the exploratory character of reported studies, by suggesting that future research on delayed lotteries should be cross-validated using both methods.

View Article: PubMed Central - PubMed

Affiliation: Economic Psychology Department, Centre for Economic Psychology and Decision Sciences, Kozminski University Warsaw, Poland.

ABSTRACT
The delayed lotteries are much more common in everyday life than are pure lotteries. Usually, we need to wait to find out the outcome of the risky decision (e.g., investing in a stock market, engaging in a relationship). However, most research has studied the time discounting and probability discounting in isolation using the methodologies designed specifically to track changes in one parameter. Most commonly used method is adjusting, but its reported validity and time stability in research on discounting are suboptimal. The goal of this study was to introduce the novel method for analyzing delayed lotteries-conjoint analysis-which hypothetically is more suitable for analyzing individual preferences in this area. A set of two studies compared the conjoint analysis with adjusting. The results suggest that individual parameters of discounting strength estimated with conjoint have higher predictive value (Study 1 and 2), and they are more stable over time (Study 2) compared to adjusting. We discuss these findings, despite the exploratory character of reported studies, by suggesting that future research on delayed lotteries should be cross-validated using both methods.

No MeSH data available.