Do the size of consideration set and the source of the better competing option influence post-choice regret?

Abstract

Regret may arise not only from the comparison of outcome, but also through various factors involved the decision-making process. However, the role of the size of consideration set, an important factor in the decision-making process, has received little attention in previous regret research. This research aims to examine how the size of a consideration set, from which a choice is made, influences post-choice regret. Results from two experimental studies show that: (1) in cases where the better performing forgone alternative comes from within the consideration set, the feeling of regret heightens when subjects have a larger self-generated consideration set; and (2) where the more competitive forgone alternative is derived from outside the consideration set, the impact of the size of the consideration set is mitigated. The research strengthens the theoretical foundation of the impact of decision process on regret and also enriches the literature on reference dependence.