Monday, March 17, 2008

Mazimizers and satisficers

I topic I have long been very interested in, perhaps because of my own decision making struggles, is the satisficer/maximizer continuum that is so well described in Barry Schwartz book the Paradox of Choice. The basic concept is that there are two 'personalities' (my word, not his) for making choice decisions. In the satisficing strategy you choose an option that is good enough to satisfy your needs, and don't worry about whether there is another option out there that might be even better. The maximizer is willing to put in the extra effort to find the best option, even after a satisfactory option is found.

Part of this of course hinges on the availability of information. If you are buying a breakfast cereal, you can easily get the price, look at the nutrition label to get the grams of fat, protein, and fiber, the levels of each vitamin, and you probably have a sense of the taste from experience or advertising. So it is easy to compare 100 different options and pick the best one if you are willing to spend the time.

But for something like health care, it is impossible to know which doctor is better or even what they will charge when you go for a visit. I switched to a high deductible health plan with a health savings account (the new "free market solution" to the health care crisis) so I have tried to do this for the past two years. I go online to find a doctor, and I find no way to compare them. I call doctors' offices ahead of time and ask what the charge will be, but they can't tell me because it depends on the diagnosis and treatment, which they don't know until I get there (and have already committed to paying). So I am forced to satisfice, even though it drives me crazy (this is why I call it a decision making 'personality'). And I no longer believe this is the free market solution we were looking for.

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