Evaluation Error and Miscommunication

case in which Gina, while in possession of a particular attribute bundle, quantifies her life satisfaction as a particular number, and Phyllis, while in possession of a different bundle, also quantifies her life satisfaction as that same number. As discussed, if Gina and Phyllis (1) have the same preferences, represented via (2) the same preference-utility function, and in addition (3) the answer each gives to a life-satisfaction survey is exactly equal to her preference utility for her current attributes, then we can infer their common WTP/WTA amounts.

“Evaluation error” and “miscommunication” constitute different types of failure of this last condition. The respondent may misapply

the utility function to her actual bundle of attributes: this is “evaluation error.” Although her actual attributes are bundle B, Gina incorrectly perceives her current preference utility to be some value

other than uGina(B). When asked, “How satisfied are you with your

life?,” Gina articulates that value, not uGina(B).

Alternatively, Gina’s perceived preference utility may be correct (she has attributes B, and indeed perceives her preference utility to be uGina(B)); but she responds to the question “How satisfied are you

with your life?” by articulating some value other than her perceived preference utility.

A 1999 book chapter by Norbert Schwarz and Fritz Strack, reviewing research on the psychology of life-satisfaction questions,

provides ample evidence of both of these effects.106

Consider, first, evaluation error. This can arise in various ways. The respondent’s preferences might depend upon features of outcomes about which she has imperfect information107 (as in the example of a preference for a faithful spouse). Or she might possess the relevant information, but fail to access it. Schwarz and Strack show how the latter occurs: the survey instrument, the respondent’s mood, or recent events may focus her attention on certain information about her current attributes and divert attention from other data.

When asked, “Taking all things together, how would you say things are these days?” respondents are ideally assumed to review the myriad of relevant aspects of their lives and to integrate them into a mental representation of their life as a whole. In reality, however, individuals rarely retrieve all information that may be relevant to a judgment. Instead, they truncate the search process as soon as enough information has come to mind to form a judgment with sufficient subjective certainty. Hence, the judgment is based on the information that is most accessible at that point in time. In general, the accessibility of information depends on the recency and frequency of its use.108

For example, researchers found a strong correlation between respondent’s dating frequency and life satisfaction only when the question about dating frequency preceded the life-satisfaction question.109

Schwarz and Strack also identify much evidence of mood effects. [J]udgments of well-being are a function not only of what one thinks about but also of how one feels at the time of judgment. A wide range of experimental data confirms this intuition. Finding a dime on a copy machine, spending time in a pleasant rather than an

106. Norbert Schwarz & Fritz Strack, Reports of Subjective Well-Being: Judgmental Processes and Their Methodological Implications, in WELL-BEING: THE FOUNDATIONS OF

HEDONIC PSYCHOLOGY, supra note 1, at 61. The terms “evaluation error” and “miscommunication” are my own; Schwarz and Strack do not use these terms.

107. Cf. Hendrik Jürges, Unemployment, Life Satisfaction and Retrospective Error, 170 J. ROYAL STAT.SOC’Y 43, 44 (2007) (discussing the effect of inaccurate memory on survey responses).

108. Schwarz & Strack, supra note 106, at 63 (citations omitted). A recent review concludes: “What information people attend to when responding to surveys can strongly affect life satisfaction judgments.” Ed Diener, Ronald Inglehart & Louis Tay, Theory and Validity of Life Satisfaction Scales, SOC. INDICATORS RES. 11 (2012), link.springer.com/article/10.1007 %2Fs11205-012-0076-y?LI=true.

unpleasant room, or watching the German soccer team win rather than lose a championship game all resulted in increased reports of happiness and satisfaction with one’s life as a whole.110

Mood effects might involve a kind of evaluation error: mood makes salient or less visible “mood-congruent” or incongruent information, respectively. (In plainer English: happy people tend to see the ways in which their lives are fulfilling their preferences, less happy people the ways in which they are not.) Mood effects might instead fall under the heading of miscommunication: the respondent might understand a life-satisfaction question as asking for a quantitative measure of her hedonic states—for experience utility— rather than for her preference utility.

“Miscommunication” is a broad category: anything that leads the respondent to articulate some number other than her perceived preference utility for her current attributes is a kind of miscommunication. For example, cultural norms may encourage individuals with especially high or low levels of preference utility to communicate a more mediocre number (or, conversely, push individuals whose preferences are only modestly realized to claim greater success).111

Depending on the order of questions, conversational norms may induce the respondent to articulate her “domain satisfaction”—subutility for a subset of attributes—rather than her preference utility for the totality of her attributes.112