Abstract
The goal of our research is to shed light on the existence of an effect of seeing the images of human faces (i.e. “a face effect”) on economic decision-making behavior. We conduct a series of controlled experiments using photographs of human faces in a newsvendor setting. Our experimental data provides evidence that the human face plays the role of an environmental moderator which triggers and intensifies the social considerations. To gain a deeper understanding of behavioral responses, we examined the impact of faces with varying characteristics, with a particular focus on the effects of facial attractiveness and perceived gender. We find that the decision-makers systematically deviate from their choices of wholesale prices when they imagine seeing the counterpart’s face. To explain how facial attractiveness and gender affect the decision choices, we develop a behavioral model that incorporates altruistic and fairness concerns.
Disclosure statement
Kay-Yut Chen has a potential research conflict of interest due to a financial interest with companies Hewlett-Packard Enterprise, Boostr and DecisionNext. A management plan has been created to preserve objectivity in research in accordance with UTA policy.
Notes
1 According to the U.S. Labor Force Statistics the age group 25-34 years represents one of the largest groups in total employment and employed with management occupation during the last decade (2011-2019). Retrieved from https://www.bls.gov/cps/demographics.htm. In order to avoid the age effect, we decrease the age interval to 25-30 years.