Poster #201 - Young Children Use Supply and Demand to Infer Quality

• In Event: 2-163 - Poster Session 08
  In Poster Session: PS 08 Section - Social Cognition

Integrative Statement

People regularly use supply and demand principles to make inferences about the quality of goods and services being sold. For example, we can infer that a doughnut shop with rapidly depleting inventory (i.e., low supply) and a long line-up (i.e., high demand) has tastier doughnuts than a shop with many doughnuts (i.e., high supply) and few customers (i.e., low demand). Previous research on children’s use of supply and demand principles has mostly focussing on their ability to make inferences about item prices and sales (Berti & Grivet, 1990; Leiser, 1983; Leiser, Sevon, & Levy, 1990; Siegler & Thompson, 1998). However, no studies have examined children’s understanding of supply and demand in relation to judgments of quality. We report three experiments examining the early development of children’s ability to make these judgments.
In Experiment 1, eighty 5-6-year-olds saw a picture of sandwich shop with 20 identical sandwiches beside it. Children were tested in either of two between-subjects conditions. In the high-demand condition, many customers were lined up to buy a small supply of sandwiches. In the low-demand condition, only a few people were lined up and many sandwiches were available. Children were asked how tasty the sandwiches were, and indicated their response on a 5-point scale. A Demand (high, low) by Age (5, 6) ANOVA only revealed a main effect of Demand, p<.001, as children gave higher quality ratings in the high-demand condition than in the low-demand condition; other ps>.159.
In Experiment 2, sixty 5-6-year-olds used a similar, but more tightly-controlled, design. To remove the possibility of subtle differences in wording affecting responses, the scripts accompanying the pictures were identical across the high-demand and low-demand conditions. In contrast with Experiment 1, though, children were shown how many sandwiches were leftover at the end of the day. An ANOVA revealed a main effect of Demand, p<.001, which was qualified by a Demand by Age interaction, p=.041. This interaction resulted because 6-year-olds gave higher ratings in the high-demand condition than in the low-demand condition, p<.001, but 5-year-olds’ ratings did not significantly differ across the conditions, p=.214.
Finally, in Experiment 3, ninety 5- to 7-year-olds were tested as in Experiment 2, but they were not informed about how many sandwiches were leftover at the end of the day. Here, an ANOVA revealed only a main effect of Demand, p<.001, as quality ratings were higher in the high-demand condition than in the low-demand condition; other ps>.104.
Together, these findings demonstrate that between the ages of 5 and 6 children are able to make inferences about the quality of items based on supply and demand. These findings show that children’s early understanding of economically-relevant relations allows them to make inferences relevant for daily life, and which do not require an understanding of money and prices.

Authors

• Michelle Huh, University of Waterloo
  Presenting Author

• Ori Friedman, University of Waterloo
  Non-Presenting Author