Do Attractive People Get a Better Deal? An Experimental Study

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.

Keywords:

• Newsvendor game
• face effect
• facial attractiveness
• experimental economics
• altruism
• fairness

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.