Regret and disappointment shape decision-making more than expected utility, new model reveals.
The article presents a new way to adjust expected utility models to account for regret and disappointment effects in decision-making. By focusing on a well-known choice pattern called the common consequence effect, the researchers found that the function correcting the utility of outcomes should have specific characteristics. They suggest that small differences between obtained and alternative outcomes can have different effects on feelings of regret and disappointment based on the size of the difference.