Context-dependent choice and evaluation in real-world consumer behavior

Abstract

A body of work spanning neuroscience, economics, and psychology indicates that decisionmaking is context-dependent, which means that the value of an option depends not only on the option in question, but also on the other options in the choice set--or the context. While context effects have been observed primarily in small-scale laboratory studies with tightly constrained, artificially constructed choice sets, it remains to be determined whether these context effects take hold in real-world choice problems, where choice sets are large and decisions driven by rich histories of direct experience. Here, we investigate whether valuations are context-dependent in real-world choice by analyzing a large restaurant rating dataset (Yelp.com) as well as two independent replication datasets which provide complementary operationalizations of restaurant choice. We find that users make fewer ratings-maximizing choices in choice sets with higher-rated options--a hallmark of context-dependent choice-- and that post-choice restaurant ratings also varied systematically with the ratings of unchosen restaurants. Furthermore, in a follow-up laboratory experiment using hypothetical choice sets matched to the real-world data, we find further support for the idea that subjective valuations of restaurants are scaled in accordance with the choice context, providing corroborating evidence for a general mechanistic-level account of these effects. Taken together, our results provide a potent demonstration of context-dependent choice in real-world choice settings, manifesting both in decisions and subjective valuation of options.