T HE P OWER OF M USIC IN D ECISION -M AKING S ITUATIONS Julia Hosch

C ONSEQUENTIALIST T HEORY OF E CONOMICS Decision Behavior Expected Outcomes Expected Emotions Immediate Emotions External Forces Rick & Loewenstein, 2012

I MMEDIATE /I NTEGRAL V E XPECTED Immediate/Integral: emotions that one feels in the moment; felt because of environmental factors, affect, or in anticipation of expected emotions Expected: emotions that one predicts that he or she will feel after an emotional event (can be negative or positive) Loewenstein, 2012

I NTEGRAL E MOTIONS ON D ECISION - M AKING Integral emotions influence risky decision making Arousal affects risk attitudes, but does not affect risk perception. “Somatic Markers”: affective ‘tags’ attached to sensory images, ‘marking’ each image with an emotional association Reduce the number of options under consideration, making decision-making process more efficient (Thompson, 2009, 123) Willingness to insure against a variety of risk Sunshine amounts  economic gain or loss in a given year (Hirshliefer and Shumway, 2007)

A RIELY STUDY : I NDUCED I NTEGRAL A FFECT LASTS LONGER THAN ORIGINALLY ANTICIPATED “Given that people do not realize that they are being influenced by the incidental emotional state, decisions based on a fleeting incidental emotion can become the basis for future decisions and hence outlive the original cause for the behavior itself. ”

A RIELY : I NDUCING I NTEGRAL E MOTIONS Can the impact of incidental emotions last longer than the emotion itself via inferences on a previous affect- based decision? 1. Incidental emotion manipulation 2. First ultimatum game (targeted participants are the receivers of an unfair offer) 3. Emotion mitigation 4. Second ultimatum game (targeted participants are the proposers) 5. Dictator Game (targeted participants are proposers)

A RIELY : R ESULTS First Ultimatum: 40% happy participants kept the bargain, 73% angry participants rejected Second ultimatum: Angry proposers made fairer offers to happy participants. Dictator game: Proposers were less fair (as per rules of the game), but they were still more likely to keep a smaller sum than the happy proposers.

R ELATIONSHIP WITH M USIC ? Effects of music: either cognitivist or emotivist (+ ATT) Cognitive: perceived emotion Emotivist: actually feeling emotion ATT (Aesthetic Trinity Theory): profound responses to music include awe, being moved, and thrills (Konečni, 2005) Music on a scale: arousal and valence (as discussed in group 1’s presentation)— these are integral emotions perceived in the moment

A DAPTING A RIELY ’ S S TUDY Method 1. Incidental Emotion Manipulation: Survey college students for background information. Half listen to music primed to be uncomfortable and harsh at a fairly fast tempo—Group 1 Ex: Stravinsky’s Rite of Spring, Schoenberg, Berg, Webern Half listen to smooth classical music—Group 2 2. First Ultimatum Game 3. Work on someone else’s thesis—some sort of down time 4. Second Ultimatum Game: Group 2 is the instigator 5. Dictator Game

H YPOTHESES H1: Listening to music has been shown to have an impact on decision-making. The reason that this is the case may be that the effect that music has temporary mood can also affect judgment. H2: Listening to music has been shown to have an impact on decision-making. However, this is due to other factors other than emotional manipulation due to music.

I MPORTANCE /F UTURE R ESEARCH If the results are the same as Ariely’s study, then this tells us that emotions created by music listening at least behave similarly to incidental emotions. It also shows that people do in fact feel the impact of music whether they are focused on it or not. Marketing Practice Habits Training for a new task