‘What is Important is Seldom Urgent and What is Urgent is Seldom Important’: A Study of the Strategic Implications of the Urgency Effect in a Competitive Setting

Mauro Papi* (Corresponding Author)

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

Abstract

The urgency effect refers to people’s tendency to choose a relatively unimportant task (with unambiguously low payoff) over a relatively important task (with unambiguously high payoff), when the former is spuriously framed as urgent. In this paper I study a simple model in which two payoff-maximising task suppliers compete for a population of heterogeneous decision-makers. Task suppliers offer tasks of various importance, and can exert costly effort to manipulate the perceived urgency of the offered tasks. Decision-makers are of two kinds: they either choose more important over less important tasks by
disregarding the urgency frames (fully rational) or behave like fully rational decision-makers, except that they are subject to the urgency effect (boundedly rational). I study the unique symmetric equilibrium of the resulting game and derive the conditions under which the urgency effect has detrimental effects on the decision-makers’ welfare. Furthermore, I examine the implications of several policies aimed at correcting the failure, which include educating boundedly rational decision-makers and auditing task suppliers that use urgency framing.
Original languageEnglish
Number of pages20
JournalEconomic Theory Bulletin
Early online date3 Sep 2022
DOIs
Publication statusE-pub ahead of print - 3 Sep 2022

Keywords

  • Bounded Rationality
  • Framing Effects
  • Urgency Effect
  • Welfare

Fingerprint

Dive into the research topics of '‘What is Important is Seldom Urgent and What is Urgent is Seldom Important’: A Study of the Strategic Implications of the Urgency Effect in a Competitive Setting'. Together they form a unique fingerprint.

Cite this