Andreas Drichoutis

Andreas Drichoutis

Andreas Drichoutis is the first author of a study, written with Rodolfo Nayga and Stathis Klonaris, that induced different moods in participants and then ran home-grown value auctions. Participants in a positive mood showed fewer preference reversals and bid lower than the others, which the authors read as more rational behaviour. The study appeared as a 2010 working paper and, under a different title, in Studies in Microeconomics in 2014. It is the vault's one auction test of mood, and it cuts against the idea that a good mood simply makes buyers more willing to pay.

Who they are

Andreas Drichoutis is an economist, known on this site through this study. Biography beyond the cited work is not recorded on this site, by rule, so no affiliation or career history is given.

The work is experimental economics. In a home-grown value auction, participants place bids for goods and the price actually paid is decided by a rule that makes honest bidding the best strategy. A preference reversal is a pattern in which people value one option more in one format and the other option more in another, and it is treated as a sign of inconsistency. The study asks whether induced mood changes how often people show that inconsistency and how much they bid.

Key papers

Drichoutis, A. C., Nayga, R. M., Jr., & Klonaris, S. (2014). Decision-making in Home-grown Value Auctions under Induced Mood States. Studies in Microeconomics, 2(2), 141-163.

Drichoutis, A. C., Nayga, R. M., Jr., & Klonaris, S. (2010). The Effects of Induced Mood on Preference Reversals and Bidding Behavior in Experimental Auction Valuation. MPRA Paper 25597, University Library of Munich. A working paper.

The vault read the abstracts of both and treated them as versions of one study. The titles differ, and the match between the two descriptions is inferred from the abstracts, not from a comparison of the full texts.

Key ideas

Mood significantly affected both the rate of preference reversals and bidding behaviour.

Subjects in a positive mood behaved more rationally and bid lower values than the others. The 2014 abstract says the comparison is positive mood against all other participants and does not report the negative-mood result separately.

The 2010 working paper also reports gender patterns in reversals that varied with whether sessions were mixed or single-gender, which this site does not use.

For the question of whether a good mood makes a price look fair, the result is a caution about direction. If a good mood simply softened buyers, bids might be expected to rise. In this study they fell. That does not show what a good mood does to a fairness judgement, which was not measured, and it rests on abstracts alone.

Sources

  1. Drichoutis, A. C., Nayga, R. M., Jr., & Klonaris, S. (2014). Studies in Microeconomics, 2(2), 141-163. Abstract read.
  2. Drichoutis, A. C., Nayga, R. M., Jr., & Klonaris, S. (2010). MPRA Paper 25597. Abstract read.