The origins of economics

Richard Thaler, speaking recently at a World Economic Forum panel.

“Let’s go back to Adam Smith,” Mr. Thaler suggested on a high-profile panel on Rebuilding Economics. “No, actually, let’s go back to Adam.”

“When it was just the demand for apples, the model still worked pretty well,” he said. “But today we have Apple and the iPhone pricing strategy.”

“Adam could deal with apples — as long as there were no serpents and women,” Mr. Thaler added. “When you add serpents and women, you get self-control problems that the model cannot deal with.”

Facebook is the marshmallow for these teenagers

That’s psychologist Walter Mischel, originator of the famous marshmallow experiment on self-control, describing the addictive properties of Facebook for today’s adolescents. To resist the temptation, some have devised creative commitment strategies.

After several failed efforts at self-regulation, Neeka Salmasi, 15, a sophomore at Greenhills School in Ann Arbor, Mich., finally asked her sister, Negin, 25, to change her Facebook password every Sunday night and give it back to her the following Friday night.

Full story in NYT.

What do marshmallows have to do with self-control?

Psychology professor Walter Mischel’s 1960s experiment involving children, sugary sweets, and self-control has become a classic. The set-up is simple. A researcher lets a child pick a favorite food from a tray of  cookies, marshmallows, candies, pretzels, and other sweets. The researcher puts that treat on the table in front of the child and makes an offer. The child can eat it now. Or the child can wait a few minutes while the researcher goes to check on something else, and get two treats when the researcher returns. If the child loses patience, she can ring a bell, the researcher will come right back, and the child can eat the treat right away. She does not get another one, of course.

How children behaved in the Mischel experiment turned out to be a good predictor of other behaviors later in life. For instance, those who couldn’t wait for the second treat had more behavioral problems in school and scored lower on standardized tests. Those who could wait scored higher, maintained friendships well, and handled stress better. The experiment has been repeated many times since. Here is a recent one with marshmallows and some kids bravely fighting temptation as best they can.

Hat tip: Johannis Jappen

About those 100 calorie snack packs…

A pair of new marketing studies in the Journal of Consumer Research says they nudge people to eat more. Previously, consumer behavior research has found that people eat more when a large portion is put in front of them.

But one of the new studies, led by Rita Coelho do Vale at the Technical University of Lisbon, found people believe smaller packages help them “regulate hedonic, tempting consumption,” but in fact their consumption can actually increase. Large packages, on the other hand, trigger concern about overeating.

The participants watched episodes of “Friends” and were told the study was about evaluating ads. Bags of potato chips — of differing sizes, of course — were slipped into the test.

The result: Smaller packages are more likely to fuel temptation. “Because they are considered to be innocent pleasures, [small packages] may turn out to be sneaky small sins,” the researchers conclude.

The other study, by three Arizona State researchers, looked directly at those 100 calorie “mini-packs.” The worst overeating is among chronic dieters.

The researchers believe their research shows that the ubiquitous small packages may actually undermine dieters’ attempts to limit calories. “On the one hand, consumers perceive the mini-packs to be a generous portion of food (numerous small food morsels in each pack and multiple mini-packs in each box); on the other hand, consumers perceive the mini-packs to be diet food. For chronic dieters, this perceptual dilemma causes a tendency to overeat, due to their emotion-laden relationship with food.”

In a series of studies, the researchers assessed peoples’ perceptions of M&Ms in mini-packs versus regular-sized packages. They found that participants tended to have conflicting thoughts about the mini-packs: They thought of them as “diet food,” yet they overestimated how many calories the packages contained. In subsequent studies, the researchers assessed participants’ relationship with food, dividing them into “restrained” and “unrestrained” eaters. The “restrained” eaters tended to consume more calories from mini-packs than “unrestrained” participants.

The same issue of the Journal also includes a study on fast food choice architecture, in which restaurants have eliminated the smallest soda sizes in response to customers who pick the middle size. Starbucks already knows this lesson.

A gym membership for gym rats

Marginal Revolution posts this item from a reader:

A Danish chain of gyms is now offering membership free of charge, with the only caveat that you have to show up, in order for the membership to be free. If you fail to show up once per week you will be billed the normal monthly membership fee for that month. This should solve the problem with incentives that gym membership normally carries – there is suddenly a very large (membership is around 85$ per month) incentive to show up each week.

Continue reading the post here.

Portion control in 68 words

Next time you sit down to dinner, dim the lights – but not too much. Both bright light and dim light may make you eat more. Watch the background music, too. If it’s too fast, you’ll eat fast, and therefore more; too slow and you’ll keep eating. And think small for plates – a portion that looks skimpy on a dinner plate looks ample on a salad plate.

From the Boston Globe.

A theory of celebrity

Inspired by Shooting Britney and Indexed, which posted a graph last week that was straight out of a behavioral economics textbook.

Procrastination is on the rise

Says Slate.

30 years ago, just 5 percent of Americans were self-described “chronic procrastinators”; today that number is up to 26 percent.

Blame technology (again). Men procrastinate more than women; the young procrastinate more than the old.

And what does all that procrastination get procrastinators? Nothing but trouble.

“Procrastinators tend to be more miserable, less wealthy, and less healthy than those people who don’t dilly-dally,” says psychologist Piers Steel.

Between a rock and a hard place

Inspired by Commitment and Self-Control by Jawwad Noor of Boston University (with a nod to indexed).