Using Casual Observation to Generate Research Ideas

October 24th, 2016

Casual observation is often a useful tool in sparking topics for academic research. To illustrate how this works, let’s consider three paradoxes about price.



Paradox 1: How much you paid either matters a lot, or it doesn’t matter at all


  1. We all know someone who, years later, still raves about the $90 dress she purchased for $6 through machinations involving a clearance rack, store credit cards, a fistful of coupons, and a doe-eyed cashier.
  2. We all know someone who has purchased something extremely expensive mostly because it was extremely expensive (i.e., conspicuous consumption).
  3. We forget the prices of almost everything we buy. (Can you remember how much tomatoes cost? What about the shirt you’re wearing?)



  1. Many products are described by their inherent or observable characteristics, but some are defined by price as the primary dimension. Over time, underpaying or overpaying can become a feature of a product. In these circumstances, price effectively takes on a hedonic role (e.g., I like it because it was really expensive or inexpensive).  
  2. Although price is one of the most important attributes when purchasing a product, it’s usually irrelevant after the purchase.



Paradox 2: Price isn’t monotonic

Observation: High prices sometimes indicate high quality, but sometimes low prices indicate high quality.

Inference: Most attributes are monotonic (i.e., the attribute and how much we like it covary in the same direction; e.g., as the quality of cheese increases, we like it more). However, price isn’t monotonic.



Paradox 3: Social factors can disrupt price

Observation: Most of us work a roughly consistent set of hours in exchange for an income (i.e., we put a price on our time). But if your neighbor offered to pay you to help clean out his basement, you’d be weirded out and likely refuse any compensation.

Inference: Price is not intrinsic; social norms can dramatically affect how we price our time.



Any one of these basic observations could initiate a line of research to evaluate whether the inference is valid, the circumstances that modulate the inference, and the mechanisms that cause it. Next time you’re struggling to develop a research idea, start by paying attention to interesting patterns in everyday life.