Steven Levitt of Freakonomics fame (and professor of economics at University of Chicago) has a new paper out on a not-so-new research project. In “Heads or Tails: The Impact of a Coin Toss on Major Life Decisions and Subsequent Happiness” (gated at NBER, a summary article is available here), Levitt finds that individuals who made important life decisions based on a coin flip were more likely to be happy two or six months afterward. Based on these findings, Levitt suggests that individuals may be too cautious in making major decisions. The abstract reads:
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.
So if in doubt, maybe you should reach in your pocket for a coin. Or you could do it like this guy: