In the world of Economics, there is a phenomenon known as the Law of Diminishing Marginal Utility. The law states that the pleasure or usefulness derived from a product decreases with each additional unit consumed. If enough of something is consumed, the marginal utility of the item will eventually become negative, doing more harm than good. According to Barry Schwartz, the same thing can occur with the amount of choice we are given. In his TED talk, The Paradox of Choice, he states, “we have passed the point where options improve welfare…complicated choices hurt, rather than help” (17:03-10:03). While choices certainly provide freedom and a sense of control, there is a point where the amount of choice, specifically in Western societies, seems excessive and redundant. When presented with a wide variety of choices, it can be overwhelming, and, in some cases, it can hinder the ability to make a choice at all. If a decision can be made, chances are, there is far less satisfaction with that choice than there would have been if the options were fewer. In Schwartz’s article, Why Decisions Disappoint: The Problem of Adaption, he explains further, “[you feel] regret about what you didn’t choose, and disappointment about what you did” (pp. 609). Disappointment and dissatisfaction are caused by numerous things and can be described concisely using a few economic and psychological concepts. Opportunity costs, myopia/Hindsight Bias, framing effects, material affluence, and something known as the Status Quo Bias are all factors that contribute to the negative and regretful feelings that can occur during and after making a choice (McConnell, Brue, Flynn pp. 164-171).
Oddly enough, the significance of the choice itself isn’t usually as relevant as what is being “passed up” by making it. Unfortunately, it seems humans will always be burdened with wondering what we missed out on when it comes to choices we didn’t make, which makes it very difficult to feel okay about the ones we did. This is also known as opportunity cost, or the loss of potential gain from other alternatives when a choice is made (McConnell, Brue, Flynn pp. 168). The more choices that are available to us, the more room there is for that regret and nagging wonder to seep in, and ruin the satisfaction that choice once provided. Schwartz states, “enthusiasm about positive experiences doesn’t sustain itself,” (pp. 609) and how can it? A choice that was made one day can be completely blighted by the options available on another, and it never ends. Generally, humans tend to lack the ability to anticipate this inevitable decline in satisfaction, feeling despondent when it occurs, which is economically known as myopia, or nearsightedness. As a matter of fact, people often imagine the alternative choices having been made after they already made one, further reducing the satisfaction of the choice actually made. This is called the Hindsight Bias, pertaining to opportunity cost (McConnell, Brue, Flynn pp.164). Context, or framing effects, also has its way of causing people to misconceive a decision needing to be made. For example, when compared to an old, run-down car, an SUV may seem like an ideal choice. However, after buying an SUV, someone might realize it’s too big for their needs, and it costs too much to fill it with gas regularly. The person would start to regret buying a brand-new SUV, as opposed to buying a brand-new sedan because the ‘framing’ of the choice is now realistic, rather than the ‘frame’ it was initially viewed with. The context in which something is presented and received, greatly impacts the satisfaction decline that takes place after the choice has already been made. Finally, material affluence, or access to choices, money, advancement, and other resources cause people to have standards and expectations that are lofty and constantly changing. Schwartz explains this by saying, “novelty can change someone’s hedonic standards so that what once was good enough, or even better than that, no longer is.” We become ungrateful and dissatisfied with a decision that now seems subpar, just because of the availability of “bigger and better” things. Getting the newest cell phone feels great, for about a month. Then, the manufacturer starts advertising an even newer model and, while the only improvement is that the screen size has increased by less than an inch, everyone must have it! At that point, it’s not even a choice being made based on the actual product, but on the fact that it’s new, and symbolic of relevance in society. All too often, we make choices out of some sort of internalized societal expectation, rather than making them because they truly make us happy. This is otherwise known as the Status Quo Bias. (McConnell, Brue, Flynn pp.170).
There is no doubt that choices provide freedom, control, pleasure, and immeasurable potential, but too much of a good thing can become defective if not acquired in moderation. In America, we are truly lucky to be able to ‘complain’ about having too many choices. If we could take a small fraction of the choices we are given, and we were somehow able to spread them out to people all over the world, only then would it equal true liberation and increase the welfare of everyone involved (Schwartz 18:05-18:25). Despite all the choices available to us, sometimes making the choice to not choose at all is the best way to go. Stanford neuroeconomist, Baba Shiv suggests, “when you lack expertise or are vulnerable, having someone else choose for you can be a good thing…. sometimes, it’s better to assume the passenger role and let someone else sit in the driving seat.” This is especially true in doctor-patient, parent-child, teacher-student situations, among others. Choice, while possessing its obvious benefits, proposes some significant negatives as well, and is something to beware of. The inevitable dissatisfaction to follow a decision is something we should be more conscious of at the time of making the choice, and we should also realize it is okay to not make a choice at all, rather than put ourselves through psychological distress and disappointment.
Reader, edited by Janice Neuleib, Kathleen Cane, and Stephen Ruffus, Pearson Learning Solutions, 2016. pp. 608-618.
McConnell, Brue, Flynn. Essentials of Economics. Third Edition. McGraw-Hill Education. 2018.
“The Paradox of Choice, with Barry Schwartz” TEDGlobal. July 2005.
https://www.ted.com/talks/barry_schwartz_on_the_paradox_of_choice?language=en#t-1099242. Accessed 7 November 2018.
Botti, Simona. Cloney, Emily. “Being Choosier About Choice”. London Business School
Review. Summer 2016, Vol. 27, Issue 2, pp 10-13.