Choice Based on Reasons: The Case of Attraction and Compromise Effects

Abstract

Building on previous research, this article proposes that choice behavior under preference uncertainty may be easier to explain by assuming that consumers select the alternative supported by the best reasons. This approach provides an explanation for the so-called attraction effect and leads to the prediction of a compromise effect. Consistent with the hypotheses, the results indicate that (1) brands tend to gain share when they become compromise alternatives in a choice set; (2) attraction and compromise effects tend to be stronger among subjects who expect to justify their decisions to others; and (3) selections of dominating and compromise brands are associated with more elaborate and difficult decisions.