An Economist’s Top Tips for a Valentine’s Date

Unlucky in love? An economist could solve all your dating woes this Valentine’s Day

As Valentine’s Day approaches I thought our bubble could do with some dating advice from an economist. Still with me? You must be desperate. By taking a look at some theories of prominent economists, from Keynes to Ariely, I hope to show that we can learn something from an economic analysis of dating. Read on for the tips that guarantee you a Valentine’s date*.

The world of dating is fiercely competitive. At university we are faced with a situation that will probably only happen once in our lives. We are surrounded by members of the opposite sex who are similarly educated, with similar interests and in the main (especially at Durham!) similar backgrounds. So really there is no excuse for being lonely this Valentine’s Day. With all these options however, come choices. How do we choose a dating partner when we have so many options? The answer is simple: we compare.

Comparison is a natural human trait. It’s built right in to our human nature. Every day we make comparisons. Apple Mac or PC? Mocha or Latte? Studio or Klute? It’s much easier to make comparisons amongst things that are similar. I can easily state my preference for apples over oranges. But when it comes to apples or crisps it’s more difficult to make a decision.

Dan Ariely in his fantastic book Predictably Irrational makes this point using an example based on The Economist’s pricing system from a few years ago. The people behind The Economist, who hopefully know a thing or two about economics (if they don’t I’ve wasted quite a bit of money), caught on to the fact that we find it easier to make decisions when a straightforward comparison is available. They offered three subscription options; an online only subscription for

John Maynard Keynes could help you get a Valentine’s date this year
59, a print subscription for 125 and a print and web subscription for 125. At first this seems curious, why would anyone choose a print only subscription for 125? Ariely ran an experiment amongst his students and discovered that given the three options 16% went for the online only option, with 84% going for the print and web option. However, he then repeated the experiment with a different group of students removing the option that nobody wanted – print only for $125. This time round 68% went for the online only option, with just 32% going for the print and web option.

This is the decoy effect in action, and as the example above shows it is extremely powerful. The print only option is a decoy – it is there to make us realise what a good deal the print and web option is. Therefore, we hand over more of our money to The Economist. Clever. Interestingly, when Ariely pointed this out to The Economist they swiftly removed the pricing system with the decoy effect. But I think it’s obvious that they knew exactly what they were doing.

So dating is all about choice, and when a decoy is present our choices can be altered dramatically. Here is the powerful tip that could transform your love life – find yourself a decoy.

Picture the scene. A girl is faced with the choice of three guys; let’s call them Will, Mike and Hugo. Now Will and Mike are pretty similar – tall, athletic and sporty. Hugo is just as attractive an option but he looks nothing like the other two. Now our girl has a pretty tricky decision to make here, with three suitors vying for her attention. This is a confusing situation to be in, but she knows that she prefers Mike over Will. As this is the easy comparison for her to make she chooses Mike, and in true Durham style they get married shortly after graduation.

Will is the “print-only” option here, in effect he is Mike’s decoy. As they are easy to compare our girl chooses the dominant option – Mike. Who knows what would have happened had just Mike and Hugo been in the running. So the advice is simple; find someone who looks like you – but worse. However, if in the run up to Valentine’s your similar looking but more attractive friend suggests a night out be wary, they could be using you as a decoy. (On a completely unrelated point; if any readers have brown skin, black spiky hair and are of average height, please do get in touch. Thanks.)

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But maybe using the sneaky decoy effect to advance your love life seems a little cruel. If you don’t agree that all’s fair in love and war, then maybe my second love lesson from an economist is for you.

In trying to explain the behaviour in the stock market, Keynes, in the General Theory of Employment, Interest and Money, used the idea of a Keynesian beauty contest as a metaphor for the stock market. In Keynes’ analogy participants were asked to choose from a set of faces the six that were most beautiful. Those who picked the most popular face were then eligible for a prize.

Now a naive strategy would be for a participant to pick the six faces that he thought were most beautiful. A more sophisticated strategy would be to pick the six faces that the participant thought the general public would find most attractive. This strategy can be taken one step further so that the participant takes account of the fact that each entrant would have their own opinion of what the public perception is. In the words of Keynes himself:

“It is not a case of choosing those [faces] that, to the best of one’s judgment, are really the prettiest, nor even those that average opinion genuinely thinks the prettiest. We have reached the third degree where we devote our intelligences to anticipating what average opinion expects the average opinion to be. And there are some, I believe, who practice the fourth, fifth and higher degrees.”

Keynes intended this as a metaphor for how the stock market operates; he was probably too busy inventing modern macroeconomics to concern himself with the economics of dating. However, I think what Keynes intended as an analogy in 1936 comes close to describing the attitude of the majority when it comes to judging the beauty of men and women today. Some people seem very preoccupied with what others think of their potential and actual dating partners. The increasing homogeneity (an economic term for looking the same) of both men and women seems to support the theory that we are judging beauty and therefore aspiring to the look that triumphs in our own modern day, real life Keynesian beauty contest. Therefore, my second piece of advice is simply this: don’t participate in a Keynesian beauty contest. If you chase people that you personally find attractive, then chances are everyone else won’t be after them as well, and you’re much more likely to be successful.

There we go – two solid, economically informed pieces of advice for success this Valentine’s Day and beyond. By using the decoy effect and learning the lessons of the Keynesian beauty contest you’ll be able to improve your dating life. All that remains is for me to wish all readers a happy – and economically informed – Valentine’s Day!

*Author has correctly predicted nine out of the last five recessions.

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