The role of subjectively perceived social complexity on attitude towards task intricacy Luigi Butera IAREP/SABE, Rome 2008

Key Questions In a non-strategic individual decision process, which attitude do we show towards the intricacy of tasks and alternatives that we face? In which manner this attitude depends on the social and relational context in which decisions have to be taken?

What is Complex and what is Complicated? “A complicated system is a system of which we are able to understand structures and principles of functioning; theoretically, having a plenty of time and money, nothing prevents us to understand it in a full and exhaustive way. On the opposite, a complex system would be a system on which we have a global vision that helps us to identify and qualify it, but that will never allow us to comprehend it in details.” H. Atlan (1972).

The Experiment 27 subjects: Control Group (14 Subjects): No Accountability Treatment Group (13 Subjects): Accountability Following the framework found in Sonsino et al. (2000, 2001), two kinds of questions have been asked to subjects: 1.Proposing a price for two saving plans, different in terms of number of indexing options available. 2.Choosing the prefferred lottery between the pair showed in each of the 4 questions. The 4 questions were constructed such that the lotteries contained in the first 2 questions had the same expected value. The very same logic applies to the 3rd and 4th lotteries.

Examples of Lotteries Lottery 1A Prob.Euro 30%150 40%80 30%100 Lottery 2A Prob.Euro 24%115 9%150 16%80 9%100 24%90 18%125 Lottery 1B Prob.Euro 30%150 40%80 30%100 Lotteria 2B Prob.Euro 100%107 Question A: Please choose between lottery 1A and 2A Question B: Please choose between lottery 1B and 2B

Tab. A: Principal Results Control GroupTreatment Group Nº Participants1413 Age23.14 (.864) (.660) % Women64.29%30.77% Evaluation for Complicated Plan (Mean Value in Euro) (115.72) (124.80) Evaluation for Simple Plan (Mean Value in Euro) (142.24) (171.60) Lottery Choice A1.35 (.497) [64.29%] 1.71 (.480) [30.77%] Lottery Choice B1.72 (.468) [28.57%] 1.84 (.375) [61.54%] Lottery Choice C1.14 (.363) [85.71%] 1.56 (.518) [53.85%] Lottery Choice D1.92 (.267) [7.14%] 1.64 (.375) [15.38%]

Tab. B: Response Time (Means) Control GroupTreatment Group Response Time (mean) Evaluation Complicated Plan 64.5 (30.25) (56.07) Response Time (mean) Evaluation Simple Plan (17.63) (37.08) Response Time (mean) Lottery choice A48.78 (37.67) (60.61) Response Time (mean) Lottery choice B25 (16.79) (42.96) Response Time (mean) Lottery choice C39.64 (22.41) (40.46) Response Time (mean) Lottery choice D16.64 (10.38) (16.43)

Psycho-physiological Measures Electro-Dermal Activity: The EDA represents the value of the skin conductivity. This parameter is considered as a good proxy of the activation of certain emotional stimulus (Bechara and Damasio 2005). Different neuro-psychological studies have identified the EDA as the physical manifestation of the cognitive activity involved during different tasks and activities. Heart Rate Variability: Heart Rate Variability is the natural variability of the cardiac frequency. It is the response to factors as the breath rate, emotional, anxiety and anger conditons. HRV is highly correlated with the interaction between Sympathetic Nervous System and the Parasympathetic Nervous System. HRV, thus, constitues an important indicator of psychological ability of adaptation and behavioural flexibilty. Thus the higher the HRV is (expressed in millisecond), the lower is the ability to react to stress and fear and the lower is the ability to adapt behaviour to new situations.

Fig. 1: Phasic EDA for the 13 registered periods Control Treatment

Figura 2: HRV per Subject

Tab. E: HRV group mean statistics Group Statistics VAR00001NMeanStd. DeviationStd. Error Mean Group StatisticsControl Treatment

Tab. F Independent Samples Test Levene's Test for Equality of Variancest-test for Equality of Means FSig.tdf Sig. (2- tailed) Mean Difference Std. Error Differen ce 95% Confidence Interval of the Difference LowerUpper Group Statistics Equal variance s assumed Equal variance s not assumed

Tabella C: dprobit Results Lottery Choice ALottery Choice BLottery Choice CLottery Choice D Treatment * ( ) * ( ) * ( ) ( ) Nota: Standard Error in parenthesis; * significance at 10%

Possible Interpretation Propensity towards complicated alternatives might be due to the willingness to appear highly knowledgeable and bright. Alternatives and procedures that require high cognitive and computational effort to be understood (thus more complicated alternatives) are selected in order to “confuse” who is supposed to judge and evaluate behaviour and choices of the decision maker. Alternatives and solutions, subjectively considered more complicated than others, are chosen because of an unconscious desire to put away the (real and/or mental) moment in which choices might be revealed as wrong or correct, and the moment in which the consequences of a choice become evident.

Thank you for your attention