The Development and Use of a Regret Experience Measure to Examine the Effects of Outcome Feedback on Regret and Subsequent Choice

This research provides insight into the experience of regret and its influence on the decision maker's subsequent aversion to risk. First, a study is conducted in order to construct a reliable multi-item measure of regret and to demonstrate that different levels of outcome feedback result in different levels of regret. A second experiment tests the validity of the regret experience measure (REM) by examining whether considering the degree of regret experienced by the respondent on a prior decision better explains subsequent choices and judgments involving risk than considering the effects of outcome feedback alone. The results of the experiment indicate that 1) the REM is both a reliable and valid measure of regret and 2) decision behavior can be better understood when both outcome feedback and regret resulting from that feedback (or the lack of feedback) are considered. Finally, the implications of these results and directions for future research are discussed.