‘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

doi:10.1007/s40505-022-00236-0

‘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

Economics

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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 language	English
Pages (from-to)	313-332
Number of pages	20
Journal	Economic Theory Bulletin
Volume	10
Issue number	2
Early online date	3 Sept 2022
DOIs	https://doi.org/10.1007/s40505-022-00236-0
Publication status	Published - Oct 2022

Bibliographical note

Acknowledgments. The quote included in the title of the paper is due to Dwight D. Eisenhower, 34th president of the USA. I am grateful to an anonymous referee, Ramses Abul Naga, Álvaro Delgado Vega, Frans de Vries, and Raghul Venkatesh for their detailed comments. I would also like to thank the seminar audience at the University of Málaga and the participants to the 2021 OLIGO workshop (Maastricht). Financial support from the University of Aberdeen Business School is gratefully acknowledged. Any error is my own responsibility.

Keywords

Bounded Rationality
Framing Effects
Urgency Effect
Welfare

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Cite this

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title = "{\textquoteleft}What is Important is Seldom Urgent and What is Urgent is Seldom Important{\textquoteright}: A Study of the Strategic Implications of the Urgency Effect in a Competitive Setting",

abstract = "The urgency effect refers to people{\textquoteright}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 bydisregarding 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{\textquoteright} 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.",

keywords = "Bounded Rationality, Framing Effects, Urgency Effect, Welfare",

author = "Mauro Papi",

note = "Acknowledgments. The quote included in the title of the paper is due to Dwight D. Eisenhower, 34th president of the USA. I am grateful to an anonymous referee, Ramses Abul Naga, {\'A}lvaro Delgado Vega, Frans de Vries, and Raghul Venkatesh for their detailed comments. I would also like to thank the seminar audience at the University of M{\'a}laga and the participants to the 2021 OLIGO workshop (Maastricht). Financial support from the University of Aberdeen Business School is gratefully acknowledged. Any error is my own responsibility. ",

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N2 - 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 bydisregarding 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.

AB - 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 bydisregarding 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.

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‘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

Abstract

Bibliographical note

Keywords

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