Goals as Reference Points in Marathon Running: A Novel Test of Reference Dependence

Abstract

Although many empirical investigations have documented reference-dependent preferences, most studies of reference dependence have considered only status quo reference points. In a large-scale field study of marathon runners, we test whether goals, a non-status quo reference point, act similarly to status quo reference points. We find that satisfaction as a function of relative performance (the difference between a runner's time goal and her finishing time) exhibits loss aversion and diminishing sensitivity, consistent with the Prospect Theory value function. Unlike the Prospect Theory value function, however, we also find a discontinuity (or jump) at the reference point. We further find that loss aversion is moderated by goal importance, that multiple reference points simultaneously impact runner satisfaction, and that loss aversion is overestimated in predictions of satisfaction, but still present in actual experienced satisfaction.