The Compromise Effect
Updated 2026-08-08
INTRODUCTION
English translation pending.
CORE DEFINITION
Documented as an extension of context effects in choice. When three options are presented and the extremes are equally unattractive, the middle option gains a disproportionate share because it can be justified as safe and reasonable. The effect demonstrates that preferences are constructed relative to the choice set rather than retrieved from a stable ranking, and it is used deliberately in pricing and product line design.
SCAFFOLDING EFFECT
Reduce cognitive load
- Price a line: place your target in the middle with a more expensive and a cheaper option beside it - Justify the choice: give the middle option a defensible rationale so buyers can explain the decision - Audit yourself: ask whether a preference is real or created by the alternatives surrounding it
Anchor fast decisions
Choice among three options invites a comparison that evaluates the extremes as risky in opposite directions. The middle option avoids both risks and is easiest to justify, so it attracts share that neither extreme commands alone. Because the evaluation is relative, adding or removing an alternative changes the choice even when the target option itself is unchanged.
MINIMUM ACTION
In progress 0/1Practice this model in one real situation:
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Source support: Explicit
- ideas.repec.orghttps://ideas.repec.org/a/oup/jconrs/v16y1989i2p158-74.htmlverified
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