Feelings and Consumer Decision Making 1 Running head: FEELINGS AND CONSUMER DECISION MAKING Feelings and Consumer Decision Making: The Appraisal-Tendency Framework

This article presents the Appraisal Tendency Framework (ATF) (Lerner & Keltner, 2000, 2001; Lerner & Tiedens, 2006) as a basis for predicting the influence of specific emotions on consumer decision making. In particular, the ATF addresses how and why specific emotions carry over from past situations to color future judgments and choices. After reviewing the main assumptions and the five main principles of the framework, two streams of research are presented. One stream addresses emotional carry-over effects on the assessment of risk; the other addresses carry-over effects on the assessment of monetary value. Because risk assessment and value assessment are fundamental psychological processes, understanding them has the potential to yield manifold implications for consumer judgment and decision making. The concluding sections highlight limitations and future directions of the framework. Feelings and Consumer Decision Making 3 Feelings and Consumer Decision Making: The Appraisal-Tendency Framework INTRODUCTION Marketing experts have long known that people behave differently in good moods versus bad moods. A large industry is devoted to creating associations between emotionally filled “atmospheres” and specific products. In this paper, we present the Appraisal-Tendency Framework (Lerner & Keltner, 2000, 2001; Lerner & Tiedens, 2006) as a general theory of emotionspecific influences on consumer judgments and choices. We argue that the framework goes beyond common intuition and prior research, specifying, for example, the conditions under which emotions of the same valence will have similar versus opposite effects as a function of multiple factors in the framework. It is our hope that not only marketing researchers but also consumers themselves will benefit from a greater understanding of these processes by which emotions shape decision making. The present paper will briefly summarize the main assumptions of the framework and delineate five principles. After reviewing the assumptions and principles, two streams of research will be presented. One stream addresses the assessment of risk; the other addresses the assessment of monetary value. These streams have been selected to exemplify the framework because of their direct relevance to consumer judgment and decision making. Feelings and Consumer Decision Making 4 THE APPRAISAL-TENDENDY FRAMEWORK Lerner and Keltner (2000, 2001) proposed the Appraisal-Tendency Framework (ATF) as a basis for distinguishing the effects of specific emotions on judgment and decision making. The ATF assumes that specific emotions give rise to specific cognitive and motivational processes, which account for the effects of each emotion upon judgment and decision making. Here we briefly review the five principles that have emerged in empirical tests of this framework. Principle 1. Integral and Incidental Emotions The ATF distinguishes between two kinds of affective influences on judgment and choice. The first, integral emotion, encompasses influences of subjective experiences that are normatively relevant to present judgments and choices (for discussion, see Loewenstein & Lerner, 2003). For example, experienced fear and anticipated regret when evaluating a gamble have been shown to influence how much one is willing to gamble (Larrick & Boles, 1995; Loewenstein & Lerner, 2003; Loomes & Sugden, 1982; Mellers Schwarz, Ho, & Ritov, 1997). The second, incidental emotion, encompasses the (sometimes) puzzling influence of subjective emotional experiences that should be normatively irrelevant to present judgments and choices. For example, emotions produced by listening to music, experiencing bad weather, or Feelings and Consumer Decision Making 5 reliving stressful events have been shown to influence judgments of unrelated topics and objects (Bodenhausen, Kramer, & Susser, 1994; Forgas & Bower, 1988; Schwarz & Clore, 1983). Such incidental carryover occurs even when decision-makers are unaware of such influences and even when concrete economic outcomes are at stake (Lerner, Small, & Loewenstein, 2004). Although both kinds of influences can exert strong effects on consumer judgment and decision making, the ATF has primarily focused on incidental influences, for two reasons. First, incidental emotions can be experimentally manipulated independently from the judgments and decisions at hand, allowing one to test causal effects of emotions on judgments and choices. Second, from a normative standpoint in judgment and decision making, incidental influences are significantly less defensible influences. Indeed decision-makers themselves regard such influences as unwanted (Wilson & Brekke, 1994). In our own studies, decision-makers deny that such influences affect their own decision making even when the evidence indicates otherwise (Han & Lerner, 2006). In sum, the ATF concentrates on incidental influences in order to gain leverage for making causal inferences and in order to help decision-makers attenuate unwanted influences. Principle 2. Beyond Valence Regardless of whether one focuses on integral or incidental influences, the majority of studies within the literature on affect and judgment have Feelings and Consumer Decision Making 6 taken a valence approach, focusing on the effects of good and bad moods upon judgment and decision making (e.g., Bower, 1991; Isen, Shalker, Clark, & Karp, 1978; Johnson & Tversky, 1983; Kavanagh & Bower, 1985; Mayer, Gaschke, Braveman, & Evans, 1992; Wright & Bower, 1992). That is, positive and negative moods have been experimentally induced or observed naturalistically and these general feeling states have been expected to produce more positive and negative judgments respectively. Not long ago, readers of the affect-judgment literature could conclude that “the only relevant aspect of emotion is their valence” (Elster, 1998, p. 64). Indeed, a valence perspective on emotional influences has been productive, documenting a wide array of influences of good and bad moods upon judgments of satisfaction, causal judgments, and social cognitive processes such as stereotyping (for review, Forgas, 2003). Some argue that valence remains the organizing principle for emotion effects on judgment and decision making. For example, in his authoritative chapter in the handbook of affective sciences, Forgas concluded that “...most of the research suggests a fundamental affect-congruent pattern: positive affect improves, and negative affect impairs, the value of self conceptions” (Forgas, 2003, p. 602). Although valence has been a powerful dimension for predicting emotion effects, it is only one dimension of emotion. The ATF harnesses the predictive power of this dimension and embeds it within a multi-dimensional theoretical framework. Feelings and Consumer Decision Making 7 Cognitive appraisal dimensions. Many emotion theorists have argued that a range of cognitive dimensions (including, but not limited to, valence/pleasantness) usefully differentiates emotional experience. Of the many excellent appraisal theories, one by Smith and Ellsworth (1985) is particularly useful for our present concerns. In an empirical examination of appraisal dimensions, Smith and Ellsworth (1985) identified six cognitive dimensions that define the underlying appraisal patterns of different emotions: certainty, pleasantness, attentional activity, control, anticipated effort, and responsibility. Numerous other studies have found similar results regarding emotion-specific appraisal patterns (Ortony, Clore, & Collins, 1988; Roseman, 1984; Scherer, 1988; Weiner, 1980; 1986). Patterns of appraisals along these dimensions, thus, provide a basis for comparing and contrasting discrete emotions. For example, certainty and control are the central dimensions that distinguish anger from fear. Anger is associated with appraisals of certainty about what happened and individual control for negative events. Fear, on the contrary, is associated with appraisals of uncertainty about what happened and situational control for negative events. Happiness, although of positive valence, is associated with an elevated sense of certainty and individual control, just like anger (Averill, 1983; Smith & Ellsworth, 1985; Weiner, 1986). Therefore, happiness, at least in one respect, resembles anger more so than fear. Feelings and Consumer Decision Making 8 Core appraisal themes. At a more macro level of analysis, each emotion can also be defined by core appraisal themes. Appraisal themes, first proposed by Lazarus (1991), are thought to provide a convenient summary of specific harms or benefits that arise in the individual’s ongoing interaction with the social environment. Emotion-specific core appraisal themes, in turn, influence the likelihood of specific courses of action (Lazarus, 1991; Frijda, 1986; Roseman, Wiest, & Swartz, 1994; Scherer, 1999, 2001). For example, anxiety is characterized by appraisals of facing uncertain existential threats (Lazarus, 1991) and thus accompanies the action tendencies to reduce uncertainties (Raghunathan & Pham, 1999). Sadness, on the other hand, is characterized by appraisals of experiencing irrevocable loss (Lazarus, 1991) and thus accompanies the action tendencies to change circumstances, perhaps by seeking rewards (Lerner et al, 2004). Although cognitive appraisals were traditionally conceptualized as causes of emotion (cognition-to-emotion), it should be emphasized that emotions may arise in any number of ways. Non-cognitive methods, such as bodily feedback or unconscious priming, have successfully induced emotion (Berkowitz & Harmon-Jones, 2004; Keltner, Ellsworth, & Edwards, 1993). In these cases, appraisals do not play a causal role in creating the emotion, but nonetheless the corresponding appraisals will ultimately be experienced to influence subsequent choices and judgments. For example, Keltner et al. (1993) have shown that emotions induced via facial muscle movements (i.e. Feelings and Consumer Decision Making 9 anger and sadness) can give rise to appraisal tendencies that shape subsequent judgments in a fashion consistent with the underlying cognitive appraisal dimension. More generally, emotions and appraisals have a recursive relationship, each making the other more likely. Because of the recursive relationship of appraisals and emotion, we believe that in most cases, fully experiencing an emotion also means experiencing the cognitive appraisals that comprise that emotional state (Clore, 1994; Frijda, 1994; Lazarus, 1994). It is important to point out, however, that a primary causal role for appraisals in emotion is not a necessary condition for the ATF. It is sufficient to assume that a discrete set of cognitive dimensions differentiates emotional experience and effects (also see review by Ellsworth & Scherer, 2003). Principle 3. Appraisal Tendencies The ATF predicts that each emotion carries with it motivational properties that fuel carryover to subsequent judgments and decisions. The particular form of that carryover takes shape through cognitive appraisal patterns and appraisal themes of specific emotions. According to the ATF, emotions not only can arise from but give rise to an implicit cognitive predisposition to appraise future events in line with the central appraisal patterns or appraisal themes that characterize the emotions (emotion-tocognition). The ATF summarizes these processes as “appraisal tendencies.” Feelings and Consumer Decision Making 10 Appraisal tendencies, although tailored to help the individual respond to the event that evoked the emotion, persist beyond the eliciting situation and affect content as well as depth of people’s thought (Figure 1). Broadly speaking, appraisal-tendency influences on judgment and decision making fall into two categories: content effects and depth-of-processing effects. Specific Emotion Appraisal Dimensions Appraisal Themes Appraisal Tendencies Content and Depth of Thought Judgment or Decision Figure 1. Main constructs of the ATF Appraisal tendencies influence the content of thought. To illustrate how appraisal dimensions of specific emotions drive the content of thought, consider the effects of sadness and anger on judgments of blame. Feelings and Consumer Decision Making 11 Sadness not only co-occurs with appraisals of situational control in the immediate situation, but also triggers appraisal tendencies to perceive situational control even in novel situations. Anger, on the other hand, cooccurs with appraisals of individual control and triggers appraisal tendencies to perceive individual control. Thus, sad people will attribute blame to situational factors whereas angry people will attribute blame to other individuals within the environment. In fact, in one of the first studies examining effects of specific emotions upon subsequent social judgment, sadness and anger were found to have opposite effects (Keltner et al., 1993). Specifically, sadness and anger were induced by presenting emotionallycharged vignettes or by having participants configure their facial expressions (unbeknownst to participants) into prototypic expressions of the target emotion. In an ostensibly unrelated study, participants were asked to make judgments and choices concerning causality. Consistent with the researchers’ expectations, sad participants perceived situationally-caused negative events as more likely than did angry participants. In addition, sad participants perceived situational forces as more responsible for an ambiguous event than did angry participants; angry participants tended to attribute blame to another individual. To illustrate how appraisal themes of specific emotions drive the contents of thought, consider the effects of anxiety and sadness on the tradeoff between risk and reward. Anxiety is characterized by appraisal Feelings and Consumer Decision Making 12 themes of uncertain existential threats (Lazarus, 1991). Sadness, on the other hand, is characterized by appraisal themes of loss (Lazarus, 1991). Thus, when debating between a high-risk / high-reward option and a low-risk / low-reward option, anxious people may choose an option that reduces risk whereas sad people may choose an option that maximizes reward. Raghunathan and Pham (1999) tested these ideas in a study where they presented a choice between a high-risk / high-reward job and a low-risk / lowreward job to participants who were experimentally induced to feel anxious or sad. Consistent with the foregoing analysis, they found that anxious decision-makers preferred the uncertainty reducing option (i.e. the lowrisk/low-reward job) whereas sad decision-makers preferred the reward seeking option (i.e. the high-risk/high-reward job) (see also Pham, 2004) . Appraisal tendencies influence depth of thought. Although the original statement of the ATF (Lerner & Keltner, 2000, 2001) addressed emotion effects only on the content of thought, Lerner and Tiedens (2006) introduced new concepts in the framework, specifying emotion effects on depth of thought as well. To illustrate how appraisal dimensions drive depth of thought, consider the effects of certain emotions and uncertain emotions on the use of simple, heuristic judgment cues, such as the expertise of the source. In a clever series of studies, Tiedens and Linton (2001) predicted that incidental emotions associated with certainty appraisals (such as anger and happiness) would result in heuristic (i.e., simple, shallow) processing by Feelings and Consumer Decision Making 13 making people feel certain in subsequent situations whereas emotions associated with uncertainty appraisals (such as fear and hope) would result in systematic (i.e., complex, deep) processing by making people feel uncertain in subsequent situations. For example, one study manipulated whether participants experienced anger, a high-certainty emotion, or anxiety, a lowcertainty emotion, by asking them to write about past events that made them angry or worried. Then, in an ostensibly unrelated study, participants filled out an opinion survey designed to measure the extent to which people relied on expertise of the source in making judgments. Consistent with the researchers’ expectations, angry participants demonstrated greater reliance on the heuristic source cue than anxious participants. Moreover, they found that the appraisal of certainty played a mediating role in determining whether people engaged in heuristic or systematic thinking (for similar results comparing anger vs. sadness, see Bodenhausen, Sheppard, & Kramer, 1994). In another example, Small and Lerner (2006) compared the effects of sadness, a low-certainty emotion, with anger, a high-certainty emotion, on welfare policy preferences. They found that sad participants recommended significantly greater welfare support than did neutral or angry participants unless the participants’ capacity to process information was constrained. When constrained by cognitive load, the recommendations of sad and angry participants were indistinguishable from each other. One can infer, Feelings and Consumer Decision Making 14 therefore, that differences in depth of processing in sadness and anger drove the differences in welfare policy preferences. Taken together, these lines of research make clear that appraisal tendencies shape not only the content, but also the process, of thought. Principle 4. Matching Constraint The ATF predicts domain specificity for the effects of distinct emotions upon judgment and choice. The influence of emotion is limited to spheres of judgment related to the emotion’s appraisals. That is, carryover is constrained by a match between the core appraisal dimensions or appraisal themes of the emotion and the salient cognitive dimensions of the judgment and choice at hand. To illustrate this matching principle, consider the case of risk assessment. An elegant literature in cognitive psychology has shown that perceptions of predictability / certainty and perceptions of control drive people’s risk perceptions (Slovic, 1987). Thus, an emotion such as fear— defined by the appraisals of uncertainty and lack of individual control— should influence judgments of risk. Indeed, it has been shown to do so — a topic about which we elaborate in Section 3. Fear, however, should not influence judgments of fairness, which is not associated with appraisals of uncertainty or control. The methodological implications of this matching principle are clear. Research should compare emotions that are highly differentiated in their appraisals on judgments / choices that relate to those Feelings and Consumer Decision Making 15 appraisals. Importantly, this principle highlights again why it is crucial to look beyond valence of emotion and identify appraisal dimensions and themes of discrete emotions. They are useful not only because they differentiate emotions in a more fine-grained way than valence approaches but also because they break down emotions into cognitive elements (or dimensions) that map emotions onto judgment and decision making processes. Principle 5. Deactivating Conditions It is almost definitional that emotional carry-over effects wane when the emotion itself wanes. There are also other ways to deactivate the carryover even when the emotion exists experientially. The ATF points to two hypotheses concerning conditions that will deactivate influences of emotion on judgment and choice. Both pertain primarily to the role of incidental rather than integral emotion. Goal-attainment hypothesis. Drawing on the idea that emotions guide specific judgments and choices to respond to significant problems or opportunities (Barrett & Campos, 1987; Schwarz, 1990), the goal-attainment hypothesis assumes that appraisal tendencies will be deactivated when an emotion-eliciting problem is solved, even if the emotion persists experientially (See Frijda, 1988). For example, Goldberg, Lerner, and Tetlock (1999) demonstrated that anger induced by a previous situation increased punitive judgments of unrelated cases, but only when the emotion-eliciting Feelings and Consumer Decision Making 16 situation remained to be solved. That is, when people learned that the perpetrator of the original anger-inducing crime was punished – and, therefore, the goal of anger served -anger did not carry over to influence future judgments (Goldberg et al, 1999). More generally, events that lead to the attainment of the goal associated with the original evocation of the emotion will attenuate the effects of that emotion upon subsequent judgments. Cognitive-awareness hypothesis. Drawing on the idea that initial emotion-related appraisals are automatic in nature (Ekman, 1992; Lazarus, 1991; LeDoux, 1996), the cognitive-awareness hypothesis assumes that appraisal tendencies will be deactivated when decision-makers become aware of their own judgment and choice processes. For example, in a now classic study, Schwarz & Clore (1983) demonstrated that mood effects on judgments of subjective well-being disappeared when people became aware of inputs to their judgments (for an updated review on these mechanisms, see Schwarz & Clore, 2003). Specifically, being reminded of ambient weather conditions reduced the effects of weather on judgments of well-being (see also Keltner, Locke, & Audrain, 1993; Gasper & Clore, 1998). More generally, emotional carryover can be deactivated by becoming aware of the judgment processes one generally uses. For example, Lerner, Goldberg, and Tetlock (1998) demonstrated that conscious monitoring of mental processes reduced the impact of incidental anger on punitive attributions and on actual punishment Feelings and Consumer Decision Making 17 by leading people to focus on judgment-relevant information and discount such judgment-irrelevant information as incidental affect. Specifically, when encouraged to become aware of one’s mental processes by an accountability manipulation, anger over past, irrelevant events no longer predicted the amount of punishment assigned in fictional tort cases. It should be noted, however, that deactivation of emotional carryover (i.e. bias correction) may be more the exception than the rule.1 In terms of the goal-attainment hypothesis, numerous factors can thwart bias correction. Many emotional goals remain unattained. In addition, even if a goal is attained, its attainment may be unknown to the decision-maker. In terms of the cognitive-awareness hypothesis, numerous factors can also thwart bias correction. Decision-makers often lack sufficient motivation to monitor their judgment processes. Moreover, even when decision-makers are motivated, achieving accurate awareness of one’s judgment process is difficult for the human mind (for review, see Wilson & Brekke, 1994). The carryover of emotion, therefore, often goes unscreened (see also Wegener & Petty, 1997 for further discussion on bias correction). In a recent study, for example, Han & Lerner (2006) found that incidental disgust led decision makers to dispose of their possessions even when participants were explicitly warned to avoid that particular tendency. Feelings and Consumer Decision Making 18 TWO STREAMS OF RESEARCH In this section, we present two streams of research that readily apply to consumer decision making. One stream addresses the assessment of risk; the other addresses the assessment of monetary value. Because risk assessment and value assessment are among fundamental psychological processes underlying a host of consumer judgments and choices, understanding them has the potential to yield manifold implications for consumer decision making. Assessment of Risk A growing literature considers the interplay between emotion and risk perception (e.g., Holtgrave & Weber, 1993; Loewenstein, Weber, Hsee, & Welch, 2001; Mellers, Schwartz, & Ritov, 1999; Slovic, Finucane, Peters, & MacGregor, 2002). Lerner and Keltner (2000, 2001) applied the ATF as a lens for predicting emotion-specific influences in judgments and choices involving risk. Fear and anger, as outlined earlier, differ markedly in appraisal dimensions of certainty and control. Whereas fear is defined by the appraisal pattern of low certainty and situational control, anger is defined by the appraisal pattern of high certainty and individual control (Smith & Ellsworth, 1985). Certainty and control, in turn, resemble cognitive metafactors that determine judgments of risk, namely “unknown risk” (hazards judged to be uncertain) and “dread risk” (hazards judged to be out of Feelings and Consumer Decision Making 19 individual control) (McDaniels, Axelrod, Cavanagh, & Slovic, 1997; Slovic, 1987). Fear and anger, the researchers reasoned, should therefore exert different influences upon risk perception. To test this, they asked participants to estimate the number of annual fatalities due to 12 events that lead to a certain number of death each year in the United States (e.g., brain cancer, strokes, floods) (Lerner & Keltner, 2000), or to estimate the likelihood that specific positive and negative events would occur in their own life compared to the lives of relevant peers (Lerner & Keltner, 2001). The results of their empirical tests were consistent with the ATF prediction: fearful people made pessimistic risk assessments, whereas angry people made optimistic risk assessments. The contrasting appraisal tendencies of fear and anger lie at the core of the diverging influences on risk assessment. The experience of fear is associated with the tendency to perceive uncertainty and situational control in new situations and thus fearful people tend to perceive greater risk across new situations. The experience of anger, by contrast, is associated with the tendency to perceive certainty and individual control in new situations and thus angry people tend to perceive less risk across new situations. (Figure 2) 2 Moreover, appraisals of certainty and control were shown to mediate the link from emotion condition to risk assessment. Feelings and Consumer Decision Making 20