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The excessive choice effect meets the market: A field experiment on craft beer choice

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  • Malone, Trey
  • Lusk, Jayson L.

Abstract

Research in psychology suggests that, somewhat paradoxically, providing consumers more choices can reduce the likelihood of making a purchase, producing the so-called excessive choice effect (ECE). To the extent an ECE exists, firms have an incentive to alleviate the effect through a variety of institutional nudges that promote consumers to make a choice. This study empirically tests the effectiveness of two institutional nudges on the ECE in a field experiment at a bar. Focusing on craft beer sales, we manipulate the number of options on the menu and use institutional nudges (a control menu, a menu with a special prominently displayed, and a menu with Beer Advocate scores). In the field experiment, the ECE was alive and well using the control menu, but the effect reversed itself when the menu included Beer Advocate scores. Our results suggest the ECE might be turned on and off by manipulating search costs.

Suggested Citation

  • Malone, Trey & Lusk, Jayson L., 2017. "The excessive choice effect meets the market: A field experiment on craft beer choice," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 67(C), pages 8-13.
    • Handle: RePEc:eee:soceco:v:67:y:2017:i:c:p:8-13
    DOI: 10.1016/j.socec.2017.01.008
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    References listed on IDEAS

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    Cited by:

    1. Trey Malone & Jayson L. Lusk, 2018. "If you brew it, who will come? Market segments in the U.S. beer market," Agribusiness, John Wiley & Sons, Ltd., vol. 34(2), pages 204-221, March.
    2. Sergio Rivaroli & Martin K. Hingley & Roberta Spadoni, 2018. "The motivation behind drinking craft beer in Italian brew pubs: a case study," Economia agro-alimentare, FrancoAngeli Editore, vol. 20(3), pages 425-443.
    3. Bazzani, Claudia & Nayga, Rodolfo M. & Ha, Kim & Atallah, Shadi S., 2017. "Willpower Depletion: Can it Influence Responses and Attribute Non-Attendance in Choice Experiments?," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 258261, Agricultural and Applied Economics Association.
    4. Aaron Staples & Bridget K. Behe & Patricia Huddleston & Trey Malone, 2022. "What you see is what you get, and what you don't goes unsold: Choice overload and purchasing heuristics in a horticulture lab experiment," Agribusiness, John Wiley & Sons, Ltd., vol. 38(3), pages 620-635, July.

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    More about this item

    Keywords

    Excessive choice; Behavioral economics; Informal institutions; Field experiment; Craft beer;
    All these keywords.

    JEL classification:

    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness

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