Heads or Tails: The Impact of a Coin Toss on Major Life Decisions and Subsequent Happiness
Little is known about whether people make good choices when facing important decisions. This paper reports on a large-scale randomized field experiment in which research subjects having difficulty making a decision flipped a coin to help determine their choice. For important decisions (e.g. quitting a job or ending a relationship), those who make a change (regardless of the outcome of the coin toss) report being substantially happier two months and six months later. This correlation, however, need not reflect a causal impact. To assess causality, I use the outcome of a coin toss. Individuals who are told by the coin toss to make a change are much more likely to make a change and are happier six months later than those who were told by the coin to maintain the status quo. The results of this paper suggest that people may be excessively cautious when facing life-changing choices.
I would like to thank Gary Becker, Stephen Dubner, Henry Farber, Lawrence Katz, Alan Krueger, John List, Susanne Neckermann, and Chad Syverson for valuable comments. Erin Robertson did an amazing job spearheading the project. Ellen Murphy and Mattie Toma provided outstanding research assistance. The views expressed herein are those of the author and do not necessarily reflect the views of the National Bureau of Economic Research.
- Study participants who made a change reported months later that they were "substantially happier" than those who did not. When...
Steven D Levitt, 2021. "Heads or Tails: The Impact of a Coin Toss on Major Life Decisions and Subsequent Happiness," The Review of Economic Studies, vol 88(1), pages 378-405.