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Explaining Consumer Choice Explaining Consumer Choice Gordon R. Foxall Explaining Consumer Choice Also by Gordon R. Foxall CONSUMER BEHAVIOUR: A PRACTICAL GUIDE MARKETING BEHAVIOUR STRATEGIC MARKETING MANAGEMENT CONSUMER CHOICE INNOVATION: MARKETING AND STRATEGY ADVERTISING POLICY AND PRACTICE (with John Driver) MARKETING IN THE SERVICE INDUSTRIES CONSUMER PSYCHOLOGY FOR MARKETING (with Ronald Goldsmith and Stephen Brown) CONSUMERS IN CONTEXT: THE BPM RESEARCH PROGRAM MARKETING PSYCHOLOGY: THE PARADIGM IN THE WINGS CONSUMER BEHAVIOUR ANALYSIS: CRITICAL PERSPECTIVES IN BUSINESS AND MANAGEMENT CONTEXT AND COGNITION: INTERPRETING COMPLEX BEHAVIOR UNDERSTANDING CONSUMER CHOICE Explaining Consumer Choice Gordon R. Foxall © Gordon R. Foxall 2007 Softcover reprint of the hardcover 1st edition 2007 978-1-4039-9862-0 All rights reserved. No reproduction, copy or transmission of this publication may be made without written permission. No paragraph of this publication may be reproduced, copied or transmitted save with written permission or in accordance with the provisions of the Copyright, Designs and Patents Act 1988, or under the terms of any licence permitting limited copying issued by the Copyright Licensing Agency, 90 Tottenham Court Road, London W1T 4LP. Any person who does any unauthorized act in relation to this publication may be liable to criminal prosecution and civil claims for damages. The author has asserted his right to be identified as the author of this work in accordance with the Copyright, Designs and Patents Act 1988. First published 2007 by PALGRAVE MACMILLAN Houndmills, Basingstoke, Hampshire RG21 6XS and 175 Fifth Avenue, New York, N. Y. 10010 Companies and representatives throughout the world PALGRAVE MACMILLAN is the global academic imprint of the Palgrave Macmillan division of St. Martin’s Press, LLC and of Palgrave Macmillan Ltd. Macmillan® is a registered trademark in the United States, United Kingdom and other countries. Palgrave is a registered trademark in the European Union and other countries. ISBN 978-1-349-54711-1 ISBN 978-0-230-59979-6 (eBook) DOI 10.1057/9780230599796 This book is printed on paper suitable for recycling and made from fully managed and sustained forest sources. Logging, pulping and manufacturing processes are expected to conform to the environmental regulations of the country of origin. A catalogue record for this book is available from the British Library. A catalogue record for this book is available from the Library of Congress. 10987654321 16 15 14 13 12 11 10 09 08 07 To Victoria James, Jorge Oliveira-Castro, Teresa Schrezenmaier, Valdimar Sigurdsson, and Mirella Yani-de-Soriano This page intentionally left blank Contents List of Figures, Tables and Exhibits viii Preface ix Acknowledgments xii Part I Foundations 1 1 Consumer Behavior Analysis 3 2 What is Intentionality? 24 3Intentionality and Mind 49 Part II Kinds of Contextual Psychology 63 4 Intentional Psychologies 65 5 Contextual Psychology (1): Intentional Behaviorism 81 6 Contextual Psychology (2): Super-Personal Cognitive Psychology 100 Part III Behavioral Economics 119 7 Herrnstein: Matching and Melioration 121 8 Rachlin: Teleological Behaviorism 133 9 Ainslie: Picoeconomics 149 Part IV Explaining Consumer Choice 165 10 Everyday Consumer Choice 167 11 Consumer Initiation and Imitation 183 12 What Kind of Explanation? 213 References 236 Index 250 vii List of Figures, Tables and Exhibits Figures 1.1 Summative Behavioral Perspective Model 9 2.1 The Structure of a Typical Neuron 45 9.1 Exponential Discount Curves for Two Differently-sized Rewards Available at Different Times 153 9.2 Comparison of Exponential and Hyperbolic Discount Curves for the Same Reward 154 9.3 Hyperbolic Curves for Two Differently-sized Rewards Available at Different Times 154 9.4 The Synaptic Junction between Neurons 158 9.5 The Many Triggers of Addiction 159 9.6 The Neuroanatomy of Reward 161 11.1 Adopter Categories as Defined by Rogers and the BPM 186 Tables 1.1 Operant Classes of Consumer Behavior 10 1.2 The BPM Contingency Matrix 10 1.3 Results of the PAD Research 15 1.4 Types of Environmental Spoliation Defined by Pattern of Reinforcement 20 5.1 Kinds of Intentional and Contextual Psychology 86 10.1 Theories of Consumer Choice 168 10.2 Self-control through Closure of the Consumer Behavior Setting 169 11.1 Adopter Categories Defined by Pattern of Reinforcement and Product Type 193 12.1 Dennett’s Evolutionary Creatures 233 Exhibits 2.1 The Three-Term Contingency 30 2.2 What is Learned? 39 5.1 Mind 90 6.1 Fetal Pain 106 8.1 Teleological Behaviorism 135 8.2 Self-Control 141 11.1 Inclusive Fitness 206 viii Preface This is the latest in a series of monographs which propose a framework for the explanation of complex human behavior such as purchase and consumption. This interdisciplinary task is primarily an exercise in the- oretical economic psychology and, as such, it draws also upon aspects of behavioral economics, philosophy and biology that are relevant to the quest for a more unified theory of consumer choice. In Context and Cognition: Interpreting Complex Behavior (Foxall, 2004), I derived a system of explanation founded upon a critique of both behavioral and intentional psychologies. The argument led to the conclusion that a strictly behaviorist, descriptive or extensional behavioral science, while essential to the prediction and possibly the control of choice, was inad- equate to the job of explaining such aspects of behavior as its continu- ity and its experience at the personal level. Intentional terms, referring to desires and beliefs, must be incorporated within a behavioral science that could achieve these requirements of theory. Two levels of the nec- essary contextual – intentional theory were put forward: intentional behaviorism, in which the basic requirements of a theory of complex behavior are proposed in the absence of ontological conjectures with respect to cognitive mechanisms; and super-personal cognitive psychology, in which an attempt is made to specify the functions of a cognitive system that would be consistent with observed patterns of behavior and the evolutionarily-consistent neuroscience that underlies them. Understanding Consumer Choice (Foxall, 2005) took this development further by applying it to patterns of purchase and consumption un- covered by the empirical research program, consumer behavior analysis (described more fully by Foxall, Oliveira-Castro, James and Schrezenmaier, 2007). The aim was to show how the kinds of contextual – intentional psychology proposed elucidate consumer choice in affluent, marketing-oriented economies and to demonstrate the rele- vance of the more abstract theoretical developments made in Context and Cognition to the more concrete world of everyday consumer decision making. (Most of the papers reporting empirical work in the behavioral economics of consumer choice have been gathered into a companion volume: Foxall, Oliveira-Castro, James and Schrezenmaier, 2007). The present volume, Explaining Consumer Choice, takes this progression further by examining in greater depth the philosophical assumptions ix x Preface that underlay the theories of contextual – intentional influence on consumer choice proposed in the earlier books. Although some famil- iarity with those works may be useful, Explaining Consumer Choice is intended to stand alone for those who encounter the subject for the first time at this level. It introduces new perspective to the quest for an understanding of consumer choice: the various schools of behavioral economics that have provided explanations of consumer behavior, especially in its extreme forms like compulsion and addiction. The import of matching analysis for consumer research lies in its demon- stration of the tendency of humans to choose smaller but soon rewards (SSRs) over larger but later rewards (LLRs), to maximize current options but not to optimize overall returns as rational choice theory predicts. This process, known as melioration (Herrnstein, 1997), contains an inbuilt drive toward addiction, and its treatment by the three intellec- tual giants of behavioral economics – Herrnstein, Rachlin (2000a) and Ainslie (2001) – throws light not only on the components of a theory of such extreme consumer choice but of the everyday choices inherent in the selection and consumption of products and brands. I identify the systems of explanation advanced by these authors with extensional behavioral science, intentional behaviorism, and super-personal cogni- tive psychology respectively, and argue that a comprehensive account of consumer choice must incorporate all three. The focus of the book is the theoretical and empirical researches that make up the consumer behavior analysis program. This has two aspects: the assessment of the theoretical adequacy of the framework that has guided much of the program, the Behavioral Perspective Model (BPM), and the explanation of the results which our applied research has revealed. These operations call upon a wider disciplinary base than has hitherto been the case: in addition to the economic psy- chology that underlays the entire research process, it has become natural to extend the task of explanation into cognate areas of biology and philosophy. In addition, the work of behavioral economists such as Herrnstein, Rachlin, and Ainslie has become more central. First, it helps clarify the more philosophical departures which the process of social scientific explanation necessitates; these in turn elucidate the nature of the behavioral economic theories these authors
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