<b>Research Note</b>—Should Consumers Use the Halo to Form Product Evaluations?

In purchase situations where attribute information is either missing or difficult to judge, a well-known heuristic that consumers use to form evaluations is the halo effect. The psychology literature has widely considered the halo a reflection of consumers' inability to discriminate between different attributes and have therefore labeled it the “halo error” or the “logical error.” The objective of this paper is to offer a rationale for the halo effect. We use a decision-theory framework to show that the halo is consistent with the goal of minimizing estimation risk. Contrary to conventional wisdom, we demonstrate that a decision using the halo has lower estimation risk compared to not using the halo heuristic. Therefore, using the halo results in utility maximization and is indicative of rational behavior.

• 저널Management Science · 54(1) · 217–223
• 토픽Decision-Making and Behavioral Economics · General Decision Sciences
• DOI10.1287/mnsc.1070.0742
• 저자Peter Boatwright, Ajay Kalra, Wei Zhang