Emotional losses loom larger in the absence of monetary damages

May 08, 2018

Damages from an accident can be both monetary and emotional. But research by Chicago Booth’s Christopher K. Hsee, Booth PhD candidate Shirley Zhang, and Northwestern’s Xueer Yu suggests that when victims pursue damages for both an emotional loss and a small monetary loss, they tend to be awarded less in total compensation than if they'd left the monetary loss out of the equation. The reason has to do with how people "anchor" uncertain quantities to more well-defined ones.