What Makes You Happierba Nonloss Or a Gain? the Moderating Role Of
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ASSOCIATION FOR CONSUMER RESEARCH Labovitz School of Business & Economics, University of Minnesota Duluth, 11 E. Superior Street, Suite 210, Duluth, MN 55802 What Makes You Happierba Nonloss Or a Gain? the Moderating Role of Regulatory Focus and Need For Cognition Ashwani Monga, University of Minnesota Rui Zhu, Rice University EXTENDED ABSTRACT - Framing refers to equivalent but different descriptions of the same information (Tversky and Kahneman 1981). For instance, consider the case of a surcharge for paying by credit card rather than cash. The same situation can be framed as a loss (i.e., penalty for paying by credit card) or as a gain (i.e., discount for paying in cash). These two frames can lead to four framed outcomesCa loss (i.e., paying the penalty), a nonloss (i.e., avoiding the penalty), a gain (i.e., getting the discount), and a nongain (i.e., not getting the discount). While both a loss and a nongain represent negative outcomes of equal magnitude, a nonloss and a gain represent positive outcomes of the same magnitude. [to cite]: Ashwani Monga and Rui Zhu (2004) ,"What Makes You Happierba Nonloss Or a Gain? the Moderating Role of Regulatory Focus and Need For Cognition", in NA - Advances in Consumer Research Volume 31, eds. Barbara E. Kahn and Mary Frances Luce, Valdosta, GA : Association for Consumer Research, Pages: 33-34. [url]: http://www.acrwebsite.org/volumes/8835/volumes/v31/NA-31 [copyright notice]: This work is copyrighted by The Association for Consumer Research. For permission to copy or use this work in whole or in part, please contact the Copyright Clearance Center at http://www.copyright.com/. What Makes You Happier–A Nonloss or a Gain? The Moderating Role of Regulatory Focus and Need for Cognition Ashwani Monga, University of Minnesota Rui Zhu, Rice University EXTENDED ABSTRACT frames (i.e., vigilance means). In terms of affect therefore, we Framing refers to equivalent but different descriptions of the should observe that gain frames lead to more favorable affect than same information (Tversky and Kahneman 1981). For instance, nonloss frames (i.e., the regulatory focus theory prediction) when consider the case of a surcharge for paying by credit card rather than individuals adopt a promotion focus, but nonloss frames lead to cash. The same situation can be framed as a loss (i.e., penalty for more favorable affect than gain frames (i.e., the prospect theory paying by credit card) or as a gain (i.e., discount for paying in cash). prediction) when individuals adopt a prevention focus. These two frames can lead to four framed outcomes—a loss (i.e., These effects should however hold only when individuals paying the penalty), a nonloss (i.e., avoiding the penalty), a gain have the processing motivation required to perceive the fit/misfit. (i.e., getting the discount), and a nongain (i.e., not getting the Research related to need for cognition (NFC) suggests that high discount). While both a loss and a nongain represent negative NFC individuals, compared to low NFC individuals, are more outcomes of equal magnitude, a nonloss and a gain represent sensitive to, and are more likely to elaborate on, the congruency/ positive outcomes of the same magnitude. incongruency of information (Cacioppo and Petty 1982; Srull, The impact of such frames on individuals’ affective experi- Lichtenstein, and Rothbart 1985). Accordingly, high NFC people ences can be viewed from two different perspectives—one based on should be more sensitive to the level of fit between regulatory focus prospect theory and another based on regulatory focus theory. and frame, and exhibit such sensitivity in their affective judgments. Regarding negative outcomes of equal magnitude, both perspec- Low NFC individuals, however, should be relatively immune to the tives make the same prediction—that negative affect evoked by a differences in fit, and therefore exhibit comparable levels of affect. loss will be greater than that evoked by a nongain. As for positive Specifically, we predict: outcomes of equal magnitude however, these two perspectives differ. While prospect theory predicts that the positive affect H1: When individuals approach a frame with a prevention evoked by a nonloss will be greater than that evoked by a gain, regulatory focus, those high in NFC should experience regulatory focus theory predicts exactly the opposite. It is this more positive affect for nonloss rather than gain frames. discrepancy that we aim to resolve in this paper. We try to figure out This difference in affect should however diminish for what makes people happier—a nonloss or a gain? low NFC individuals. According to prospect theory (Kahneman and Tversky 1979), H2: When individuals approach a frame with a promotion framing manipulations determine whether individuals will evaluate regulatory focus, those high in NFC should experience an outcome as a gain or a loss in relation to a reference point. Given more positive affect for gain rather than nonloss frames. that the loss portion of the prospect theory value function is steeper This difference in affect should however diminish for than the gain portion, the predictions that arise are that (1) for the low NFC individuals. same negative outcome, a loss feels worse than a nongain, and (2) for the same positive outcome, a nonloss feels better than a gain. We use a series of scenario-based experiments to understand Regulatory focus theory (Higgins 1997, Idson et al. 2000) how regulatory focus might be induced in framed situations, and presents a different view of framing effects. According to this how this might have implications for affect. We first demonstrate theory, a gain/nongain situation encourages a promotion focus, (pretest 1) that buying situations induce a prevention focus whereas which in turn is likely to make a current goal seem like a maximal selling situations induce a promotion focus. Consequently (experi- goal. In contrast, a loss/nonloss situation induces a prevention ment 1), in support of our hypotheses, we observe an interesting focus, which in turn is likely to make the same goal seem like a reversal among high NFC participants, such that nonlosses produce minimal goal. While minimal goals are those that one must achieve, more favorable affect than gains in buying situations, but gains maximal goals represent those that one aspires to achieve. Accord- produce more favorable affect than nonlosses in selling situations. ingly, failing to achieve a minimal goal (e.g., a loss) should be more This effect is absent among low NFC participants. We next repli- aversive than failing to achieve a maximal goal (e.g., a nongain), cate the buying situation results using a different scenario (pretest whereas achieving a higher order maximal goal (e.g., a gain) should 2). Finally (experiment 2), we find further support for our theorizing be more pleasurable than achieving a minimal goal (e.g., a nonloss). by employing the same buying situation, but inducing a global, Notice that the latter prediction of gains being more pleasurable frame-unrelated regulatory focus before individuals actually see than nonlosses is the exact opposite of the prospect theory predic- the frame. tion. Overall, our results demonstrate that, given adequate process- In order to reconcile this discrepancy, we argue that one factor ing motivation, the prospect theory prediction (i.e., nonloss>gain) ignored by both theories is the regulatory focus that individuals holds for prevention focus individuals and the regulatory focus have when they approach framed situations. We suggest that affect theory prediction (i.e., gain>nonloss) holds for promotion focus will be more positive when regulatory fit (Higgins 2000, Higgins et individuals. This research presents insights into not only framing al. 2003) exists between individuals’ regulatory focus, and the effects, but also the broader issue of how it is not only the ends, but frame. Regulatory fit occurs when the strategic manner of one’s also the means that matter. goal pursuit is aligned with his or her regulatory orientation. Specifically, eagerness means fit a promotion focus and vigilance REFERENCES means fit a prevention focus. 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