Regret in economic and psychological theories of choice

Numerous studies have shown that choice can be influenced by expectations of regret or disappointment (or, for positive outcomes, of rejoicing or elation). Psychological researchers measure these expectations with self-report instruments, economists infer them from observed choice behavior. The present study examines whether the emotion postulates embodied in economic choice models correspond to expected and experienced emotions as measured by self-report. In a laboratory study (n=50) of student participants playing real-money lotteries, we included questionnaire measures of expected emotions for each possible lottery outcome. These emotion measures are reliable and well behaved, and modestly predictive of actual choices. They did not, however, conform well to the specific postulates of economic choice models, though they did show some of the juxtaposition effects proposed in such models. Emotional reactions to decision outcomes may be better characterized by broad measures of positive and negative affect than as nuanced mixtures of distinct emotions.