Date of Award

2015

Degree Type

Dissertation

Degree Name

Doctor of Philosophy (PhD)

Graduate Group

Operations & Information Management

First Advisor

Katherine L. Milkman

Abstract

This dissertation is on topics in behavioral economics. It contains two chapters that are methodologically and topically distinct.

The first chapter is entitled “Quitting: The Downside of Great Expectations in Competitions.” This research examines ranked professional athletes who compare themselves with their opponents. Athletes with better rankings than their competitors are called “favorites” and are expected to win. Athletes with worse rankings than their competitors are called “underdogs” and are expected to lose. Favorites enjoy many advantages over other competitors, but this chapter demonstrates that favorites are also more likely to quit in competition than underdogs. This is particularly true when competitors face adversity. When favorites begin to lose, they may attempt to save face by quitting, and thereby manage the impressions that others form of them. This chapter reports on an analysis of 328,425 men’s professional tennis matches and demonstrates that favorites are discontinuously more likely to quit mid-match than underdogs. It also contains results from surveys and interviews of athletes that support an impression management account for the observed quitting pattern.

The second chapter in this dissertation is entitled “The Role of Incentive Salience in Habit Formation.” This research consists of analysis of data from a behavioral intervention related to exercise. In this intervention, pedometer wearers received incentives for every step they took over the course of a two week period. Users were randomly assigned to a “salient” condition, in which incentives were announced and explained in repeated emails, and a “non-salient” condition, in which information about incentives could be easily accessed, but was not sent to users via email. The purpose of the experiment was to compare the average daily steps in the “salient” and the “non-salient” conditions after the intervention period concluded to determine if longer-lasting post-intervention walking habits were induced when enhanced incentives were highlighted. Results indicate that the salience manipulation was successful and led to greater daily steps during the intervention, and to habits that persisted after the end of the intervention.

Together, the chapters in this dissertation contribute to the substantial and growing literature on individual decision making.

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