Working class prefers comedy and the intellectual class goes for drama

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This is the Theatre Royal of Newcastle. (Credit: Darrel Birkett)

 study enjoying Spanish participation has analysed the theatre demand of society according to the socioeconomic status of the different types of the viewing public. The results were that the theatre is not just enjoyed by the intellectual classes. While they do prefer drama, the working class opts for comedy and the wealthier are swayed by reviews.

Theatre arts are loss-making services that require subsidies to stay afloat. This type of practice has frequently come under fire as it is thought that theatre is consumed mainly by society's economic elite.

A study published in the Journal of Cultural Economics proves this notion wrong. According to its results, the so-called "intellectual class" prefers dramas, the "working class" opts for comedies and the wealthier are influenced by professional reviews when they have paid for a theatre ticket.

"The aim was to analyse theatre demand. It was based on a type of models used in microeconomics that analyses how individuals make their decisions. These models are used frequently in transport and marketing and go by the name of discrete choice models. We conducted surveys in two of Newcastle's most important theatres," as explained by J.M. Grisolía, coauthor of the study and researcher at the University of Las Palmas de Gran Canaria.

Newcastle is home to different types of theatres, from the most modern, like the Northern Stage, to older examples. The experts worked with the 3,000 observations obtained from a survey performed on 300 people.

As the researcher points out, "we presented individuals with ten hypothetic choice scenarios, each with five alternatives. Each option was defined by its attributes: price of the theatre ticket (from £7 to £35), the type of theatre, the genre (comedy, drama and experimental theatre), repertoire (classic, modern, contemporary), author (famous or unknown), expert or popular reviews (light-hearted, forums, word of mouth)."

The experts combined different variables for obtaining multiple interactions until arriving at ten choice scenarios in order to extract more information from each subject. The model used is called a latent class model, which groups the sample individuals into different categories.

One class, one scenario

The model clearly identifies three different classes that attend the theatre: a "well-off" class that represents 43.1% of the sample and is characterised by preference for classic theatre venues, enjoying all types of theatre and showing more willingness to pay, especially when reviews have been good.

The "working" class includes more young theatre goers (25.4% of the sample) who are mainly interested in comedy, consulting non-professional reviews more frequently and displaying less willingness to pay. Lastly, the model identifies an "intellectual" or "cultural" class (31.5%) with high willingness to pay for theatre productions that have a special preference for drama and form their opinion more independently of the reviews. "It is important to highlight that the intellectual class is not the same as the wealthy class," outlines the author.

Grisolía concludes that "these are the three ways in which theatre connects with society. Although it is seen as an elitist pastime, it also has a more popular side. The results are very useful for marketing actions and sales policies and help us to understand the role that theatre plays in each strand of society."

The study was financed by the UK government through the Arts and Humanities Research Council , an agency in charge of promoting humanities and arts in general. It was carried out by the team of José M. Grisolía, from the University of Las Palmas de Gran Canaria and Ken Willis from the University of Newcastle in the UK.

 

Journal Reference:

  1. José M. Grisolía, Kenneth G. Willis. A latent class model of theatre demand. Journal of Cultural Economics, 2012; 36 (2): 113 DOI: 10.1007/s10824-012-9158-6

Better monitoring of food quantity makes self-control easier

 New research from the University of Minnesota's Carlson School of Management suggests learning how to stop enjoying unhealthy food sooner may play a pivotal role in combating America's obesity problem. The research, published in the Journal of Consumer Research, explores how satiation, defined as the drop in liking during repeated consumption, can be a positive mechanism when it lowers the desire for unhealthy foods.

"When people talk about self-control, they really imply that self-control is willpower and that some people have it and others don't when facing a tempting treat," says Joseph Redden, an assistant professor of marketing at the Carlson School and lead author of the 'Healthy Satiation: The Role of Decreasing Desire in Effective Self-Control.' "In reality, nearly everyone likes these treats. Some people just stop enjoying them faster and for them it's easier to say no."

Through a series of experiments, Redden and Texas A&M University assistant professor of marketing Kelly Haws discovered that when people with high self-control eat unhealthy foods they become satisfied with the experience faster than when they are eating healthy foods and thus eat less. In one study, the researchers asked participants to monitor themselves as they ate by counting how many times they swallowed. With this subtle clue to the amount eaten, those with low self-control became satisfied at a faster rate. Redden said they were surprised at how easy it was to recreate self-control — just using a baseball pitch counter made low self-control people act like they had high self-control.

"People can essentially use attention for how much they are consuming instead of relying on self-control," Redden says. "Really paying a lot more attention to the quantity will lead people to feel satiated faster and eat less."

Planning ahead: Consumers prefer fewer options when thinking about the future

 Consumers generally prefer having more options when choosing among products but not when making choices involving the distant future, according to a study from Washington University in St. Louis.

"The lure of assortment may not be as universal as previously thought. Consumers' preferences for large assortments can decrease due to a key psychological factor — psychological distance," write authors Joseph K. Goodman, PhD, and Selin A. Malkoc, PhD, both assistant professors of marketing at Olin Business School.

Retailers have known for decades that consumers prefer large selections and are lured by more options and greater variety. For example, when planning a family outing to an ice cream shop this coming weekend, a consumer would most likely choose the local shop offering 33 flavors over another in the neighborhood offering fewer options.

How universal is this demand for more choice? Are there instances when smaller selections are acceptable or even desirable? The authors find that consumer preference for larger selections decreased for psychologically distant decisions, such as when consumers have to make decisions that are six months away or while on vacation across the country.

They show this change in preference for an array of products and services, namely restaurants, ice cream shops, chocolatiers, home appliances and vacation packages.

"Psychological distance is common concern when consumers are making decisions related to the future such as a vacation, insurance or retirement planning," Malkoc says.

"In such instances, consumers tend to focus on the end goal and less about how to get there and this leads to predictable changes in consumer behavior," she says.

"I'm constantly amazed by the massive amount of choice we have in the marketplace, and it just keeps expanding, making it even more difficult for consumers to make a choice," Goodman says. "I'm very excited about finding instances when consumers might not want so much choice, and can thus avoid some of the difficulty of choosing."

When planning a vacation that is months away, a consumer would probably prefer to hear about fewer dining options in the city they will be visiting than if their vacation was coming up in less than a week.

"In product categories where psychological distance is automatically evoked, it might not be necessary for retailers to offer a large and overwhelming number of options," the authors conclude. "Consumers may even be attracted to those sellers offering a smaller and simpler assortment of options."


Journal Reference:

  1. Joseph K. Goodman and Selin A. Malkoc. Choosing Here and Now versus There and Later: The Moderating Role of Psychological Distance on Assortment Size Preferences. Journal of Consumer Research, 2012 (in press) DOI: 10.1086/665047

What do saving money and losing weight have in common?

Consumers will pay more when they are given different options to pursue short-term goals, but will pay more for similar options when pursuing long-term goals, according to a new study in the Journal of Consumer Research.

"Many of the benefits of pursuing self-control goals such as being healthy are experienced in the future. Thus, a key component of our success in meeting our goals is the ability to remain motivated. One way for consumers to manage motivation is to strategically choose the options available to them in pursuing their goals," write authors Jordan Etkin and Rebecca K. Ratner (both University of Maryland).

Consumers often use multiple products to help them achieve their goals. For example, a health-conscious consumer might go shopping for healthy snacks to consume over the next few days. She might purchase many packages of the same healthy snack or a variety of healthy snacks. Would she be more motivated to be healthy this week if she plans to consume many different snacks instead of the same snack repeatedly? How about over the next year?

In one study, consumers were more motivated to save money in the present when they thought about different approaches to saving, but more motivated to save money over the next year when thinking of similar approaches to saving. In another study, consumers participated in an auction for a personal training session. When told the session would take place in a week, consumers were willing to pay more when the trainer emphasized different exercises. However, when the session would take place in a month, consumers were willing to pay more when the trainer emphasized similar exercises.

"Companies wanting to encourage consumers to focus on being healthy in the present should highlight differences among product assortments while highlighting similarities when encouraging healthy behavior in the future. Consumers seeking to save money could focus on differences among the ways they are currently saving to keep them motivated in the present, or on similarities between the ways they are saving to keep them motivated as they plan for the future," the authors conclude.


Journal Reference:

  1. Jordan Etkin and Rebecca K. Ratner. Goal Pursuit, Now and Later: Temporal Compatibility of Different versus Similar Means. Journal of Consumer Research, February 2013

When do we lie?

Almost all of us have been tempted to lie at some point, whether about our GPA, our annual income, or our age. But what makes us actually do it?

In a study forthcoming in Psychological Science, a journal of the Association for Psychological Science, psychological scientists Shaul Shalvi of the University of Amsterdam and Ori Eldar and Yoella Bereby-Meyer of Ben-Gurion University of the Negev investigated what factors influence dishonest behavior.

Previous research shows that a person's first instinct is to serve his or her own self-interest. And research also shows that people are more likely to lie when they can justify such lies to themselves. With these findings in mind, Shalvi and colleagues hypothesized that, when under time pressure, having to make a decision that could yield financial reward would make people more likely to lie. They also hypothesized that, when people are not under time pressure, they are unlikely to lie if there is no opportunity to rationalize their behavior.

"According to our theory, people first act upon their self-serving instincts, and only with time do they consider what socially acceptable behavior is," says Shalvi. "When people act quickly, they may attempt to do all they can to secure a profit — including bending ethical rules and lying. Having more time to deliberate leads people to restrict the amount of lying and refrain from cheating."

The researchers first tested participants' tendency to lie when doing so could be easily justified: Approximately 70 adult participants rolled a die three times such that the result was hidden from the experimenter's view. The participants were told to report the first roll, and they earned more money for a higher reported roll.

Seeing the outcomes of the second and third rolls provided the participants with the opportunity to justify reporting the highest number that they rolled, even if it was not the first — after all, they had rolled that number, just not the first time they rolled the die. Some of the participants were under time pressure, and were instructed to report their answer within 20 seconds. The others were not under time pressure, and had an unlimited amount of time to provide a response.

The experimenters were not able to see the actual die rolls of the participants, to ensure all rolls were private. Instead, in order to determine whether or not the participants had lied about the numbers they rolled, Shalvi and colleagues compared their responses to those that would be expected from fair rolls. They found that both groups of participants lied, but those who were given less time to report their numbers were more likely to lie than those who weren't under a time constraint.

The second experiment followed a similar procedure, except that the participants were not given information that could help them justify their lies: instead of rolling their die three times, they only rolled it once and then reported the outcome. In this experiment, the researchers found that participants who were under time pressure lied, while those without a time constraint did not.

Together, the two experiments suggest that, in general, people are more likely to lie when time is short. When time isn't a concern, people may only lie when they have justifications for doing so.

One implication of the current findings is that to increase the likelihood of honest behavior in business or personal settings, it is important not push a person into a corner but rather to give him or her time," explains Shalvi. "People usually know it is wrong to lie, they just need time to do the right thing."

Affluent people less likely to reach out to others in times of chaos, study suggests

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While chaos drives some to seek comfort in friends and family, others gravitate toward money and material possessions, a new study finds. (Credit: iStockphoto/Rob Friedman)

Crises are said to bring people closer together. But a new study from UC Berkeley suggests that while the have-nots reach out to one another in times of trouble, the wealthy are more apt to find comfort in material possessions.

"In times of uncertainty, we see a dramatic polarization, with the rich more focused on holding onto and attaining wealth and the poor spending more time with friends and loved ones," said Paul Piff, a post-doctoral scholar in psychology at UC Berkeley and lead author of the paper published online this month in the Journal of Personality and Social Psychology.

These new findings add to a growing body of scholarship at UC Berkeley on socio-economic class — defined by both household income and education — and social behavior.

Results from five separate experiments shed new light on how humans from varying socio-economic backgrounds may respond to both natural and human-made disasters, including economic recessions, political instability, earthquakes and hurricanes. They also help explain why, in times of turmoil, people can become more polarized in their responses to uncertainty and chaos.

For example, when asked if they would move across the country for a higher-paying job, study participants from the lower class responded that they would decline in favor of staying close to friends, family and colleagues. By contrast, upper class participants opted to take the job and cut ties with their community.

Although the study does not provide a definitive reason for why the upper class, when stressed, focuses more on worldly goods than relationships, it posits that "material wealth may be a particularly salient, accessible and preferred individual coping mechanism … when they are threatened by perceptions of chaos within the social environment."

Each experiment was done with a different group of ethnically and socio-economically diverse participants, all of whom reported their social status (household income and education) as well as their level of community mindedness and/or preoccupation with money.

In a lab setting, researchers induced various psychological states in their subjects — such as uncertainty, helplessness or anxiety — so they could accurately assess how social class shapes the likelihood of people turning to others or to wealth in the face of perceived chaos.

Chaos is defined in the study as "the feeling that the world is unknown, unpredictable, seemingly random … a general sense that the world and one's life have turned uncertain and topsy-turvy." This uncertainty typically triggers either a fight-or-flight or a "tend-and-befriend" response, which researchers used to assess participants reactions to induced stress.

In the first experiment, a nationwide sample of 76 men and women ranging in age from 18 to 66 were tasked with selecting, online, a visual graph that best reflected the trajectory of economic ups and downs they believed they were likely to face in their lifetimes. The results showed that the upper class and, to a small degree, Caucasian participants, were less likely than the lower class and minorities to anticipate financial instability. Lower-class participants who expected more turmoil in their lives were more likely to turn to community to cope with perceived chaos, the study found.

In the second experiment, 72 college students were asked to write about positive and negative factors that could impact their educational experience. Potential threats that they cited included canceled classes, tuition hikes and academic failures. Again, worries about chaos and helplessness spurred lower class college students — but not the upper class ones — to say they would turn to their community for support. In the third experiment, 77 students were put through computerized tasks in which they rearranged into sentences words that either alluded to chaos or something negative. This exercise was designed to prime certain participants to see their environment as unpredictable and scary. When these participants were offered five minutes to take part in a community building task where they could develop friendships with a group of their peers, only lower class participants jumped at the opportunity.

The fourth experiment had 135 students unscramble similar words into sentences and then report on how much they agreed with such statements as "Money is the only thing I can really count on" and "Time spent not making money is time wasted." When made to feel as if the world was chaotic, upper class participants consistently agreed more strongly with these statements.

In the fifth experiment, 115 students were given a hypothetical scenario in which an employer offered them a new job for a higher salary, with the caveat that they would need to move, and potentially lose touch with their current network of family, friends and colleagues. Again, when primed with feelings that the world was uncertain and chaotic, upper class participants were more amenable to cutting ties and taking the job, whereas lower class participants opted to stay close to their support networks.

"Given the very different forms of coping that we observe among the upper and lower classes, our research suggests that in times of economic uncertainty and social instability, disparities between the haves and the have-nots could grow ever wider," Piff said.

Other coauthors of the study are UC Berkeley psychologist Dacher Keltner; Daniel Stancato, a psychologist in Seattle, Wash.; Andres Martinez of George Mason University and Michael Kraus of the University of Illinois, Urbana-Champaign. The research was funded in part by the National Science Foundation.

 

Journal Reference:

  1. Paul K. Piff, Daniel M. Stancato, Andres G. Martinez, Michael W. Kraus, Dacher Keltner. Class, Chaos, and the Construction of Community.. Journal of Personality and Social Psychology, 2012; DOI: 10.1037/a0029673

Want to encourage eco-friendly behavior? Give consumers a nudge (Don't tell them what to do)

Consumers are more likely to change their behavior if they voluntarily commit to changing rather than being told what to do, according to a new study in the Journal of Consumer Research. So carefully nudge them along if you're trying to encourage more eco-friendly behavior.

"Commitment promotes consistent changes in behavior, especially if consumers pledge specific steps to promote the desired behavior. Consumers who publicly express a commitment to the environment will reinforce their commitment and increase sustainable behavior," write authors Katie Baca-Motes, Amber Brown (both Disney Research), Ayelet Gneezy, Elizabeth A. Keenan (both University of California, San Diego), and Leif D. Nelson (University of California, Berkeley).

Influencing sustainable behavior is an ongoing challenge in today's world. Hotels often ask consumers to "do their part" for the environment by reusing towels, but this approach has limited success. Appeals to adhere to social norms (i.e., informing guests that the majority of guests in a hotel reuse their towels) have been shown to be more effective, yet leave an estimated 50% of hotel patrons unresponsive.

The authors studied consumers staying at a California hotel. At check-in, guests were asked to either make a general commitment to be environmentally friendly or to make a specific commitment to reuse towels during their stay. Notably, the commitment was entirely symbolic—once guests checked in, they were able to exist in anonymity and behave as they wished. To reinforce the commitment, some guests who chose to commit further received a "Friend of the Earth" lapel pin.

Asking guests to make a specific commitment to hang towels made them more likely to hang their towels. However, when they made a specific commitment to practice sustainable behavior and received a pin to symbolize that commitment, their subsequent behavior was significantly more eco-friendly. They were more likely to reuse towels as well as turn off the lights when they left their rooms.

"Rather than telling consumers what they should be doing, companies, nonprofits, or government agencies wishing to influence behavior change should consider an alternative option—one that creates an appealing opportunity for consumers to start with a small step—a non-binding commitment that will likely nudge their behavior in the desired direction," the authors conclude.


Journal Reference:

  1. Katie Baca-Motes, Amber Brown, Ayelet Gneezy, Elizabeth A. Keenan, and Leif D. Nelson. Commitment and Behavior Change: Evidence From the Field. Journal of Consumer Research, February 2013

Under the influence: Reminders of money impact consumer decision-making

— When reminded of money (not cost), consumers are more likely to evaluate a new product based on its primary features or brand name, according to a new study in the Journal of Consumer Research.

"Money and symbols of money are ubiquitous in our daily consumer environment, and money is linked to social resources such as security, status, power, confidence, and freedom. Mere reminders of money have the potential to signal confidence and strength and thereby impact consumers when making decisions," write authors Jochim Hansen (University of Salzburg), Florian Kutzner (University of Heidelberg), and Michaela Wänke (University of Mannheim).

Consumers encounter money or symbols of money all the time. We earn, save, spend, or possibly lose money. We physically handle bills and coins. We are reminded of money by proverbs (e.g., A penny saved is a penny earned), songs (e.g., Money, Money, Money), and movie titles (e.g., The Color of Money). Given the importance of money in our lives, it is important to understand the psychological implications of such frequent reminders of money.

In a series of studies, the authors found that reminders of money caused consumers to think more abstractly and focus on the primary features of a product instead of its secondary features. For example, we might wonder if a television has great picture or sound quality and not pay any attention to the warranty. Or we might think about whether a yogurt is healthy or tasty but ignore the package design. Additionally, consumers reminded of money are more likely to evaluate a new product based on its brand name instead of its individual features. For example, we might think that a new bike by Mercedes must be good because Mercedes is a good brand and ignore its actual features.

"Our studies show that reminders of money influence consumer decision-making. Consumers should keep this in mind when choosing products, because they may overlook certain features when reminded of money," the authors conclude.


Journal Reference:

  1. Jochim Hansen, Florian Kutzner, and Michaela Wänke. Money and Thinking: Reminders of Money Trigger Abstract Construal and Shape Consumer Judgments. Journal of Consumer Research, April 2013 (in press)

When punters punt: Stock analysts use instinct when forecasting firms they don't know, study suggests

When stock analysts aren't sure how to assess the earnings of a hard to value firm, they often just predict those earnings will follow the general trend of the market, according to new research from the University of Iowa.

"If there's too much uncertainty and they don't have a lot of information to go with, analysts look at overall market sentiment to guide their forecasts," says Paul Hribar, professor of accounting in the UI Tippie College of Business.

Hribar said this bow to investor sentiment is a form of bias that often influences how analysts forecast the earnings of the firms they cover. Sentiment, Hribar says, is driven as much by emotion as by analysis and can reflect errors in investors' expectations about future payoffs, leading to mispriced stocks and a market that doesn't reflect underlying fundamentals.

Yet, Hribar's study appears to show that analysts' forecasts are heavily influenced by investor sentiment when firms don't have a lot of data to analyze.

Hribar and his study co-author, John McInnis of the University of Texas at Austin and a UI PhD alumnus, examined analysts' earnings per share forecasts and long-term earnings growth forecasts for every month from August 1983 to December 2006. From a final sample of more than 646,000 monthly observations, they looked at how accurate those forecasts were one year after they were published.

One thing they quickly found was that analysts are exceedingly optimistic, over-estimating actual earnings in every month in the sample period. In cases where analysts were optimistic, actual earnings did not measure up to forecast earnings. In those cases where analysts were pessimistic, they weren't pessimistic enough because the firms lost more money than the analysts predicted.

The study also found that some firms proved especially troublesome for analysts to forecast, particularly when it come to small firms, young firms, unprofitable firms, stocks with high volatility, and stocks with no dividends. In those cases, the analysts simply don't have enough data to make a sufficiently informed forecast, so they appear to apply existing sentiment to help generate their forecasts.

"When sentiment is high, earnings forecasts become more optimistic for those firms, and when sentiment is low, the forecasts follow suit," says Hribar. The pattern follows in both monthly forecasts and long-term quarterly and annual forecasts.

Hribar said the research took into account the fact that the firms could not be arbitraged as a way to explain the difference between forecast and actual earnings, but found that was not responsible. The researchers also considered the idea that forecasters were intentionally overstating earnings estimates to drive a bull market, but their analysis found that was not the case either, so that any over-optimism is unintentional.

Instead, he says the analysts seem to apply an subconscious bias and assume the stock will perform as well or as poorly as they expect the rest of the market to perform, reflecting investor sentiment.

"Analysts rarely say they don't know, but in a lot of these cases, it would be better for them to say they don't know," he says. The reason is because investors rely on these forecasts to make investment decisions, and if those decisions in the end are being made only on overall investor sentiment, then those stocks are mispriced and the market is not an accurate reflection of economic performance.

Hribar's and McInnis' paper, " Investor Sentiment and Analysts' Earnings Forecast Errors," was published recently in the journal Management Science.


Journal Reference:

  1. Paul Hribar, John M. McInnis. Investor Sentiment and Analysts' Earnings Forecast Errors. Management Science, 2012; 58 (2): 293-307

Healthy outlook leads to a healthy lifestyle, study suggests

A 'can do' attitude is the key to a healthy lifestyle, University of Melbourne economists have determined.

Researchers from the Melbourne Institute of Applied Economic and Social Research analysed data on the diet, exercise and personality type of more than 7000 people.

The study found those who believe their life can be changed by their own actions ate healthier food, exercised more, smoked less and avoided binge drinking.

Professor Deborah Cobb-Clark, Director of the Melbourne Institute of Applied Economic and Social Research, said those who have a greater faith in 'luck' or 'fate' are more likely to live an unhealthy life.

"Our research shows a direct link between the type of personality a person has and a healthy lifestyle," she said.

Professor Cobb-Clark hoped the study would help inform public health policies on conditions such as obesity.

"The main policy response to the obesity epidemic has been the provision of better information, but information alone is insufficient to change people's eating habits," she said.

"Understanding the psychological underpinning of a person's eating patterns and exercise habits is central to understanding obesity."

The study also found men and women hold different views on the benefits of a healthy lifestyle.

Men wanted physical results from their healthy choices, while women were more receptive to the everyday enjoyment of leading a healthy lifestyle.

Professor Cobb-Clarke said the research demonstrated the need for more targeted policy responses.

"What works well for women may not work well for men," she said.

"Gender specific policy initiatives which respond to these objectives may be particularly helpful in promoting healthy lifestyles."

The study used data from the Household, Income and Labour Dynamics in Australia (HILDA) Survey.