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We examined how perceptual fluency affects risk preference judgments and explored 1 important boundary condition for its effect. All participants were presented with a lottery scenario that required them to choose between a lottery ticket and a coupon that they could redeem when making
a purchase or to set a price at which they would sell the same lottery ticket. Perceptual fluency was elicited by asking participants to read the scenario set out in a way that was either easy or difficult to understand. The results showed that when the likelihood of getting a desirable outcome
was relatively high, participants who experienced decreased perceptual fluency tended to be risk aversive in the choice task but risk seeking in the pricing task. Accordingly, several mechanisms are discussed that potentially underlie this preference reversal effect along with theoretical
and practical implications of our findings.

SummaryPreference Reversal Phenomenon (PRP) has been most often scrutinized as a puzzle of 'preferences', while the discovery of the 'endowment effect' explicitly questions the parity between preference and price. The author's experiment (N = 186) connects these two extraordinary findings and illustrates that PRP is only a reversal of price in a 'market.' PRP merely proves that subjects demand to be compensated based on loss under market access deprivation when a 'maximum buying'/'minimum selling' price is elicited, and preference transitivity is restored once the misleading market manipulation is experimentally controlled.By defending preference transitivity, the author asserts that normal access to the bargaining process is indispensable for a competitive market where preference price parity is required.To make valid measurements of preference and price, the sealed envelope method is substituted for the judged‐indifferent‐point (JIP) method, and the binding statement method is substituted for the Becker‐DeGroot‐Marschack method. McNemar test scores are calculated to compare the effects of different methods.

AbstractIntertemporal preference reversals occur when individuals choose future option A over future option B in a direct choice between the two but place a higher 'immediate cash' value on B than on A. Tversky et al. (1990) reported strong evidence of such reversals, which they attributed mainly to valuation biases rather than intransitivity. We find similar levels of reversals, even after adjusting for considerable degrees of variability and imprecision in people's responses. However, we disagree with Tversky et al.'s conclusions about the causes of the majority of these reversals. We find substantial levels of intransitivity in respondents' binary choices as well as differential overvaluation of both options relative to the values inferred from their choices.

Abstract
A fundamental contribution of consumer behavior research is to help marketing scholars develop an understanding of how people think about and express their preferences. In this article we find that two commonly used preference elicitation procedures, willingness to pay (WTP) and choice, are consistently associated with different expressed preferences. Specifically, choices are associated with a relatively greater preference for hedonic goods, while WTP is associated with a relatively greater preference for utilitarian goods. We find that this is caused, in part, by the greater reliance on deliberation in determining WTP values, while preferences in choices are determined by an affect heuristic. Unlike other choice and WTP preference reversals, we find that this effect is not caused by mechanical determinants such as scale compatibility, as the effect persists with continuous scale measures that rely on affect and with choice-based scale measures that rely on determining valuation.

Research on preference reversals has demonstrated a disproportionate influence of outcome probability on choices between monetary gambles. The aim was to investigate the hypothesis that this is a prominence effect originally demonstrated for riskless choice. Another aim was to test the structure compatibility hypothesis as an explanation of the effect. The hypothesis implies that probability should be the prominent attribute when compared with value attributes both in a choice and a preference–rating procedure. In Experiment 1, two groups of undergraduates were presented with medical treatments described by two value attributes (effectiveness and pain-relief). All participants performed both a matching task and made preference ratings. In the latter task, outcome probabilities were added to the descriptions of the medical treatments for one of the groups. In line with the hypothesis, this reduced the prominence effect on the preference ratings observed for effectiveness. In Experiment 2, a matching task was used to demonstrate that probability was considered more important by a group of participating undergraduates than the value attributes. Furthermore, in both choices and preference ratings the expected prominence effect was found for probability.

Two studies demonstrated preference reversals using consumer products. Some subjects made a choice between a pair of food or hygiene products while others assigned minimum selling prices to each product. Product pairs were selected such that one item had a high market price but was undesirable (e.g. eggplant roulettes) while the other item had a low market price but was desirable (e.g. a can of soda). As predicted, most subjects choose the low market price/desirable item, but the high market price/undesirable item was assigned a higher minimum selling price. Experiment 1 used a hypothetical questionnaire, while in Experiment 2 responses had real consequences. The results suggest a market value heuristic such that when decision makers are unsure of how to translate their preference into a specific dollar amount they substitute the product's market price for their own preference. The implication of this heuristic is that if merchants consistently set the retail price of a particular product at a certain level, consumers will use that retail price as the basis of their pricing evaluations and will come to value the product at the retail price.

ABSTRACTThis article explores the impact of consumers' regulatory goals on their relative focus on hedonic (versus utilitarian) benefits of products. Drawing from extant literature, we argue that promotion‐focused consumers will exhibit more favorable attitude towards a product when its hedonic benefits are highlighted in comparison to its utilitarian benefits. Prevention‐focused consumers on the other hand will exhibit more favorable attitude towards a product when its utilitarian benefits are highlighted in comparison to its hedonic benefits. We further argue that this effect is moderated by contextual factors, such as evaluation mode. In addition, we argue that the posited difference only holds when the hedonic and utilitarian products are evaluated individually. When the two products are evaluated jointly, both promotion and prevention‐focused individuals will exhibit more favorable attitude towards the hedonic product. Two studies were conducted to test the hypotheses and findings supported our predictions. Copyright © 2011 John Wiley & Sons, Ltd.