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Type: Journal article
Title: Living near the edge: how extreme outcomes and their neighbors drive risky choice
Author: Ludvig, E.
Madan, C.
McMillan, N.
Xu, Y.
Spetch, M.
Citation: Journal of Experimental Psychology: General, 2018; 147(12):1905-1918
Publisher: Wolters Kluwer; American Psychological Association
Issue Date: 2018
ISSN: 0096-3445
Statement of
Elliot A. Ludvig, Christopher R. Madan, Neil McMillan, Yaqian Xu, Marcia L. Spetch
Abstract: Extreme stimuli are often more salient in perception and memory than moderate stimuli. In risky choice, when people learn the odds and outcomes from experience, the extreme outcomes (best and worst) also stand out. This additional salience leads to more risk-seeking for relative gains than for relative losses-the opposite of what people do when queried in terms of explicit probabilities. Previous research has suggested that this pattern arises because the most extreme experienced outcomes are more prominent in memory. An important open question, however, is what makes these extreme outcomes more prominent? Here we assess whether extreme outcomes stand out because they fall at the edges of the experienced outcome distributions or because they are distinct from other outcomes. Across four experiments, proximity to the edge determined what was treated as extreme: Outcomes at or near the edge of the outcome distribution were both better remembered and more heavily weighted in choice. This prominence did not depend on two metrics of distinctiveness: lower frequency or distance from other outcomes. This finding adds to evidence from other domains that the values at the edges of a distribution have a special role.
Keywords: Risky choice; decision making; memory; extreme outcomes; edge effects
Rights: © 2018 American Psychological Association
RMID: 0030117984
DOI: 10.1037/xge0000414
Appears in Collections:Psychology publications

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