UCL School of Management is delighted to welcome Niro Sivanathan, LBS to host a research seminar discussing ‘The unintended nudge: A case for argument dilution effect’.
Advertising of pharmaceutical drugs is a $4.5 Billion a year industry. These advertisements have resulted in an increased demand, by patients, for these drugs. We provide the first evidenced based psychological account of a more serious concern that warrants the re-examination of the merits of pharmaceutical drug advertisements. Across five experiments and a sample of over 3000 US participants, we find reliable evidence for the argument dilution effect (the tendency for weak or irrelevant information to dilute the key information within an argument). Specifically, when commercials list all side-effects, both serious and minor, as required by the FDA, it dilutes consumers’ judgements of the overall severity of side effects, compared to when only the serious side-effects are listed. Furthermore, this leads to an increased willingness to pay for those drugs. In regulating pharmaceutical advertisements, the FDA appear to have paradoxically increased the marketability of these drugs.