ABSTRACT
Imagine two consumers, Mary and Kathy, filling up their respective gas tanks at a gas station in Chicago. Mary is delighted to learn that she pays $1.40 per gallon. On the other hand, Kathy feels upset when she learns that she has to pay $1.40 per gallon. What causes this emotional imbalance between these two people? Mary lives in Chicago where gas prices are usually higher, whereas Kathy happens to stop at this gas station while traveling from a small town, where gasoline costs less. One explanation for Mary’s happiness and Kathy’s disappointment derives from two types of thoughts that are likely to run through their minds. First, neither expected this price. Second, Mary and Kathy used different standards when evaluating the price: Mary compared the price with the average price in Chicago, which is normally higher than $1.40, whereas Kathy compared the price with the one in her hometown, which is normally lower than $1.40. That is, Kathy’s unhappy feeling, instigated by the unexpected high price of gas, may have been intensified by her imagining an alternative counterfactual situation (i.e., “What if I had filled up back at home?”). Conversely, Mary’s happy feeling may have been heightened by her imagining an alternative counterfactual situation (i.e., “What if I had filled up yesterday?”). This kind of “what if” thinking—the process of imagining alternatives to reality, or of comparing “what is” with “what might have been”—is what social psychologists refer to as counterfactual thinking.
