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  <front>
    <journal-meta />
    <article-meta>
      <title-group>
        <article-title>Understanding Effects of Personalized vs. Aggregate Ratings on User Preferences</article-title>
      </title-group>
      <contrib-group>
        <contrib contrib-type="author">
          <string-name>Gediminas Adomavicius</string-name>
          <email>gedas@umn.edu</email>
          <xref ref-type="aff" rid="aff2">2</xref>
        </contrib>
        <contrib contrib-type="author">
          <string-name>Jesse Bockstedt</string-name>
          <email>bockstedt@emory.edu</email>
          <xref ref-type="aff" rid="aff0">0</xref>
        </contrib>
        <contrib contrib-type="author">
          <string-name>Shawn Curley</string-name>
          <email>curley@umn.edu</email>
          <xref ref-type="aff" rid="aff2">2</xref>
        </contrib>
        <contrib contrib-type="author">
          <string-name>Jingjing Zhang</string-name>
          <email>jjzhang@indiana.edu</email>
          <xref ref-type="aff" rid="aff1">1</xref>
        </contrib>
        <aff id="aff0">
          <label>0</label>
          <institution>Emory University</institution>
          ,
          <addr-line>Atlanta, GA</addr-line>
          ,
          <country country="US">USA</country>
        </aff>
        <aff id="aff1">
          <label>1</label>
          <institution>Indiana University</institution>
          ,
          <addr-line>Bloomington, IN</addr-line>
          ,
          <country country="US">USA</country>
        </aff>
        <aff id="aff2">
          <label>2</label>
          <institution>University of Minnesota</institution>
          ,
          <addr-line>Minneapolis, MN</addr-line>
          ,
          <country country="US">USA</country>
        </aff>
      </contrib-group>
      <abstract>
        <p>Prior research has shown that online recommendations have significant influence on consumers' preference ratings and their economic behavior. However, research has not examined the anchoring effects of aggregate user ratings, which are also commonly displayed in online retail settings. This research compares and contrasts the anchoring biases introduced by aggregate ratings on consumers' preferences ratings to those produced by personalized recommendations. Through multiple laboratory experiments, we show that the user preferences can be affected (i.e., distorted) by the displayed average online user ratings in a similar manner as has been shown with personalized recommendations. We further compare the magnitude of anchoring biases by personalized recommendations and aggregate ratings. Our results show that when shown separately, aggregate ratings and personalized recommendations create similar effects on user preferences. When shown together, there is no cumulative increase in the effect, and personalized recommendations tend to dominate the effect on user preferences. We also test these effects using an alternative top-N presentation format. Our results here suggest that top-N lists may be an effective presentation solution that maintains key information provided by recommendations while reducing or eliminating decision biases.</p>
      </abstract>
      <kwd-group>
        <kwd>eol&gt;Recommender systems</kwd>
        <kwd>personalized ratings</kwd>
        <kwd>aggregate ratings</kwd>
        <kwd>preference bias</kwd>
        <kwd>anchoring effects</kwd>
        <kwd>laboratory experiments</kwd>
      </kwd-group>
    </article-meta>
  </front>
  <body>
    <sec id="sec-1">
      <title>1. INTRODUCTION</title>
      <p>Most recommender systems use user ratings for previously
consumed items as inputs to the system’s computational techniques
to estimate preferences for items that have not yet been consumed
by the individual. For example, Netflix users are asked to rate the
movies they have watched on a 5-star scale (with 1 being the least
liked and 5 the most liked). The Netflix recommender system then
analyzes patterns of users’ ratings to understand users’ personal
interests and predict their preferences for unseen movies. Many
real-world recommender systems present these estimated user
preferences in the form of system-predicted ratings to indicate
expectations of how much the consumer will like items, serving as
recommendations. Here we use the term “recommendation”
broadly to encompass any rating that is displayed to the user with
the intention to convey some item “quality” information, including
the ratings at the low end of the scale (such as the recommender
system’s predictions that the user will dislike the item). After users
experience or consume the suggested item(s), they can submit their
input in the form of item ratings back to the recommender system,
IntRS 2016, September 16, 2016, Boston, MA, USA.</p>
      <p>
        Copyright remains with the authors and/or original copyright holders.
which are used to analyze the system’s accuracy and improve future
recommendations, completing a feedback loop that is central to a
recommender systems’ use and value
        <xref ref-type="bibr" rid="ref2">(Adomavicius et al. 2013)</xref>
        .
Recent studies show that interacting with online personalization
and recommendation systems can have unintended effects on user
preferences and economic behavior
        <xref ref-type="bibr" rid="ref1 ref2 ref4">(Cosley et al. 2003;
Adomavicius et al. 2012, 2013)</xref>
        . In particular, users’ self-reported
judgments can be significantly distorted by the system’s
predictions. For example, Adomavicius et al. (2013) found
evidence that a recommendation provided by an online system
affects users’ ratings for products, even immediately following
consumption. Additionally, Adomavicius et al. (2012) found that
personalized ratings displayed to users significantly swayed their
willingness to pay for items in the direction of the system-displayed
rating value.
      </p>
      <p>In addition to personalized ratings for products (representing
estimated preferences of individual users), aggregate ratings for
products (representing population-level preference consensus) are
another important type of information on which users often rely to
make their product purchase or consumption decisions. While in
both cases the information often is presented in an identical or
nearly identical manner (e.g., as numeric scale values or star
ratings), their underlying meanings are very different. However,
no prior research has systematically examined or compared the
potential biases caused by information presented as aggregate
information about other users’ evaluations vs. personalized
preference predictions from a recommender system. Therefore, we
explore four issues related to the impact of aggregate vs.
personalized ratings:
(1) The bias issue: Are users’ self-reported preference ratings for
products drawn toward the displayed aggregate values? In
other words, do preference biases that have been observed
with personalized ratings extend to non-personalized,
aggregate ratings?
(2) The relative effect size issue: Observing which type of
information results in a higher effect size: aggregate or
personalized ratings?
(3) The combination issue: What is the combined effect of
providing both aggregate and personalized ratings, as
compared to receiving one alone?
For the fourth issue, we first note that, instead of displaying rating
information as numeric values (e.g., personalized system-predicted
ratings or mean aggregate ratings), sometimes systems use rating
information to compile and display top-N item lists of “best” (or
recommended) items. As examples, many news websites
recommend the top-10 articles to their readers based on their
interests and browsing histories, and Amazon suggests lists of
products that their customers might find interesting. These
recommendations are merely displayed on the webpage as a list of
items (either ranked or not-ranked) often with no underlying rating
values. Studying this type of presentation format provides a
robustness check on the biasing effects of personalized and
aggregate ratings.
(4) The presentation format issue: Are users’ self-reported
preference ratings for products still influenced by the
displayed information, when the aggregate and personalized
ratings are used to produce the recommendations as a list of
the top-N items but without displaying explicit numeric rating
values?
We conducted three controlled laboratory experiments, in which
the recommendations based on aggregate and/or personalized
ratings presented to participants were manipulated to answer the
aforementioned research questions. In all studies, participants were
asked to read a number of jokes, reporting their preference rating
immediately after reading each joke.</p>
    </sec>
    <sec id="sec-2">
      <title>2. BACKGROUND</title>
      <p>
        Research studies in decision making, behavioral economics, and
marketing have consistently observed judgmental biases across a
variety of context settings
        <xref ref-type="bibr" rid="ref7">(e.g., see contributions in Gilovich et al.
2002)</xref>
        . In lay usage, the term “bias” has a negative connotation,
suggesting a negative prejudice. In behavioral economic and
decision research, however, the word bias is used in a more agnostic
manner to represent a systematic pattern of deviation from a norm
or rational standard of judgment
        <xref ref-type="bibr" rid="ref10">(e.g., Haselton et al. 2005)</xref>
        .
Decision biases are not always detrimental for the decision maker;
instead, the term bias highlights predictable tendencies that
judgments follow under certain decision conditions.
      </p>
      <p>In the context of users responding to recommendations, we define
bias relative to a rational standard that is at least implicit, if not
explicit, in all real-world instances of their use. The presumption
is that the consumer’s stated preference rating is a non-adulterated
expression of their preference for the product or experience itself,
as tailored to the provided scale. This should particularly be true
when there is no delay between the experience or consumption of
the item being rated and the reporting of the preference. This
standard parallels the normative principle of invariance described
and tested by Tversky and Kahneman (1986) in their discussion of
framing effects as a judgmental bias. If a personalized
recommendation significantly impacts the stated preference,
signaling an adulteration of the preference, then we say that a
decision bias has been introduced by the recommendation.
In identifying bias in this way, it is important to recognize the
timing of the connection between the system’s recommendation
(which may include personalized or aggregate ratings for an item)
and the consumer’s subsequently submitted preference rating.
Prior to experiencing the item, consumers seek and receive
recommendations as a way of guiding their choices, purchases,
and/or expectations concerning the item. At this pre-consumption
stage, the recommendations represent a highly valuable service to
consumers, providing help for finding and selecting relevant items
and managing the potential information overload in many online
settings. Once the item has been experienced, however, the
recommendation is not assumed to provide value in the assessment
of the user’s inherent preference for that item. This is particularly
true if the item has just been consumed, i.e., there is no potential
uncertainty about the experience due to recall effects (e.g., when
users are trying to remember how they felt about a movie that they
saw a year ago). Recommendations are designed to provide value
at the pre-consumption stage; if they impact post-consumption
preferences as well, this represents a bias relative to the presumed
standard of unpolluted preference.</p>
      <p>Within the context of recommender systems, a few studies have
explored how personalized system-predicted ratings influence
online consumer behavior. These studies have shown strong and
consistent evidence that ratings provided by consumers are biased
toward system-generated recommendations when consumers
construct their judgments for products. For example, Cosley et al.
(2003) explored the effects of system-generated recommendations
on user re-ratings of movies and found that users showed high
testretest consistency when no prediction was provided. However,
when users re-rated a movie while being shown a “predicted”
personalized value that was altered upward or downward from their
system’s actual prediction by a single fixed amount of one point
(i.e., providing a higher or lower prediction), users tended to give
higher or lower ratings, respectively, as compared to a control
group receiving the system’s actual predictions. This showed that
system predictions could affect users’ ratings based on preference
recall, for movies seen in the past and now being evaluated.
Additional recall-based effects are explored by Bollen et al. (2012).
More recently, Adomavicius et al. (2013) examined system effects
in three laboratory studies for items elicited at the time of item
consumption. The design removes possible explanations deriving
from the preference uncertainty that can be present at the point of
recall, i.e., when trying to evaluate one’s preferences for an item
that may have been experienced long ago. In this setting, one’s
preferences should arguably be based solely on the immediate
experience of the item; no uncertainty is present. Even without a
delay between consumption and elicited preference, consumers’
preference ratings were consistently influenced by the
systemgenerated personalized recommendations. The effect was observed
across different content domains (TV shows and jokes). And, the
effect obtained whether the recommendation was seen before or
after watching a TV show; so, an explanation based on priming the
viewers’ expectation for the upcoming experience was not
supported. Consistently, the displayed system predictions, when
perturbed to be higher or lower, affected the submitted consumer
ratings to move in the same direction.</p>
      <p>
        Further, recent research has found that the system-generated ratings
can significantly affect consumers’ economic behavior with respect
to the suggested items
        <xref ref-type="bibr" rid="ref1">(Adomavicius et al. 2012)</xref>
        . Using three
controlled experiments in the context of digital song purchases, the
authors found strong evidence that song recommendations
substantially affected participants’ willingness to pay for the songs,
even when controlling for participants’ preferences and
demographics. The effects persisted even when item uncertainty
was reduced, in this case by forcing participants to listen to song
samples prior to pricing the songs. The effect also persisted when
scale compatibility issues were removed. Scale compatibility is
another common explanation for biases whereby using the same
scale for predictions and user ratings creates a demand effect to
increase the correspondence between stimulus and response. In the
study, willingness-to-pay judgments were expressed using a 0-99
scale, i.e., in U.S. cents, and system ratings where expressed using
a typical 1-5 star scale. Thus, the effect of system
recommendations is not purely an effect of reacting to a numerical
value on a common scale. Overall, the biases resulting from system
recommendations on preference judgments have been shown to be
robust across a variety of digital goods, settings, and conditions.
Further, these biases can be potentially harmful in several ways
        <xref ref-type="bibr" rid="ref2 ref4">(Cosley et al. 2003; Adomavicius et al. 2013)</xref>
        . From the
consumers’ perspective, recommendation biases can distort (or
manipulate) their preferences and their purchasing behavior and,
therefore, lead to distortions in their self-reported preference
ratings and suboptimal product choices. From the firm’s
perspective (e.g., Amazon, Netflix), these biases may allow
thirdparty agents to manipulate the recommender system so that it
operates in their favor. This would reduce consumers’ trust in the
recommender system and harm its value in the long term. From the
system designers’ perspective, the distorted user preference ratings
that are subsequently submitted as consumers’ feedback can pollute
the inputs of the recommender system, reducing its effectiveness.
In addition to personalized system-predicted ratings, aggregate
ratings represent an alternate source of information about item
“quality” that is directly relevant to users’ decision making. In
particular, they can be viewed as non-personalized (i.e., same for
all users) recommendations that indicate the population-level
consensus about the general quality level of a given item. This
information may be derived from peer ratings or from aggregating
sales, download, or click data. Similar to personalized
recommender system predictions, aggregate rating information
may be communicated to consumers in the form of numeric values,
such as mean peer ratings, or can be used to construct top-N lists of
generally best-liked items.
      </p>
      <p>Note that the nature of the rating effects can be studied from both
macro-level and micro-level perspectives. The market, macro-level
perspective investigates the market effects of how ratings and
recommendations impact sales, downloads, or other aggregate
outcomes of interest to retailers. From the consumer, micro-level
perspective, the interest is on how ratings and recommendations
impact the behaviors of individual users.</p>
      <p>The study of macro-level outcomes has been an active area of
research investigation in recent years. For example, with respect to
the effects of providing aggregate ratings, Tucker and Zhang (2011)
studied the impact of popular bestseller listings based on previous
clicks upon the number of future clicks received. Similarly,
Godinho de Matos et al. (2016) investigated the influence of peer
ratings, expressed as a list of most popular movies, on market sales
within a natural field experiment. Also, using an experimental
methodology by creating a music market of unknown songs and
artists, Salganik et al. (2006) manipulated whether or not the
participants saw the number of downloads made by others and
studied the effect of this social influence on market factors. An
example of academic research that investigated the market-level
effects of personalized recommendations is a study by Fleder and
Hosanagar (2009) who, using analytical modeling and simulation,
suggested that recommendation systems can lead to a
rich-getricher effect for popular products, resulting in a decrease in sales
diversity in the aggregate. Somewhat in contrast, results of Fleder
and Hosanagar also suggested that personalization technologies
help users to widen their interests, increasing the likelihood of
commonality with others.</p>
      <p>
        In contrast, the micro-level effects have been underexplored in
research literature, especially with respect to the aggregate ratings
and their impact on individual consumer preferences. Therefore,
we focus on this issue in our current study: How do personalized
system-predicted ratings and aggregate peer ratings compare and
contrast as influences on individual users’ reactions, particularly in
the preference bias that they produce?
This comparison is particularly interesting, because the influences
of personalized vs. aggregate ratings on user behavior are
hypothesized along quite different psychological mechanisms. For
example, supplying aggregate data within a music market, Salganik
and Watts (2008) demonstrated the effect that aggregated
popularity feedback had upon individual-level responses in terms
of choices to listen to and download songs. The mechanism for the
effect derives from social motivations, grounded in the literatures
on social influence. The general dynamic is one in which the
consumer engages in a form of observational learning of how to
behave based on the behavior of others. In contrast, personalized
recommendations do not arise from social comparison. Depending
on the recommendation algorithm, the personalized
systempredicted rating may or may not have any connections with others’
behavior. For example, content-based algorithms depend on
matching feature characteristics, not on the preferences of other
users
        <xref ref-type="bibr" rid="ref12">(Ricci et al. 2011)</xref>
        . Even algorithms that incorporate
preferences of other users, e.g., collaborative filtering techniques
        <xref ref-type="bibr" rid="ref12">(Ricci et al. 2011)</xref>
        , generally do not make the connection explicit
or obvious to the consumer. Therefore, rather than mechanisms
grounded in social psychology, the effects of personalized ratings
can be posited on bases of anchoring, information integration, and
processing explanations. For example, one proposed mechanism is
in terms of scale compatibility, as mentioned above. Another
sample mechanism proposed for the effects of personalized
recommendations is an information integration explanation
whereby the system-predicted rating is perceived as a piece of
information that the user should use in constructing their judgment
        <xref ref-type="bibr" rid="ref11">(cf. Mussweiler and Strack 1999)</xref>
        .
      </p>
    </sec>
    <sec id="sec-3">
      <title>3. STUDY 1: Individual Effects of Aggregate</title>
      <p>vs. Personalized Ratings</p>
    </sec>
    <sec id="sec-4">
      <title>3.1 Design</title>
      <p>
        This study focused on research questions (1) and (2). All the
studies described in this paper involved the consumption and rating
of jokes, so the participant population required no special
characteristics. Participants were 118 recruits from a US college’s
research participant pool. Participants were paid a fixed $10 fee for
completing the study. Demographic features of the sample are
summarized in Table 1 separately for each of the two conditions of
the between-subjects component of the design. Participant
characteristics are comparable between the two treatment groups.
The mean time for completing the study was 29.03 minutes, which
suggests subjects invested ample time and that fatigue was not an
issue.
Our study used 100 jokes from the Jester joke database, which has
been extensively used in prior literature
        <xref ref-type="bibr" rid="ref2 ref9">(Goldberg et al. 2001;
Adomavicius et al. 2013)</xref>
        . Jokes are stimuli that can be experienced
in the lab session, so that the readers’ preference ratings can be
gathered immediately after the reading of each joke; there is no
uncertainty of preference due to memory effects. As noted in
Section 2, the standard assumption in such a situation is that the
user’s rating should provide an unadulterated expression of the
reader’s preference, forming the normative expectation against
which bias is defined.
      </p>
      <p>The between-subjects manipulation in the study is based on the type
of rating information that is presented to study participants:
personalized vs. aggregate ratings. In other words, the information
is presented as either a personalized rating from a recommender
system or as a mean rating of other users. Each participant saw
only one type of rating information, either the aggregate or
personalized ratings, for all the jokes.</p>
      <p>Using a 5-star rating scale (allowing half-star ratings), participants
first evaluated 50 jokes, which were randomly selected from the list
of 100 and randomly ordered. These ratings provided a guise of
collecting data from which to derive personalized
recommendations, and also allowed us to calculate rating
predictions for use in the analysis as a control for individual
differences in preference.</p>
      <p>Next, the subjects received 45 jokes with rating-based information
displayed. Half of the subjects randomly received the information
in the form of aggregate ratings displayed as “Average user rating
of this joke is: X (out of 5)”, while the other half in the form of
personalized ratings displayed as “Our system thinks you would
rate the joke as: X (out of 5)”. Here X is a specific rating value that
was assigned separately for each joke. In both of these treatment
groups (referred to as AggregateOnly and PersonalizedOnly
groups), the participants saw 45 jokes in three within-subjects
conditions. Specifically, 20 of these jokes were assigned to the
High condition, which consisted of randomly-generated high
values between 3.5 and 4.5 stars (drawn from a uniform
distribution); another 20 jokes were assigned to the Low condition,
which consisted of randomly-generated low values between 1.5 and
2.5 stars (drawn from a uniform distribution); and the remaining 5
jokes were assigned as the Medium condition which included
randomly generated values between 2.5 and 3.5 (drawn from a
uniform distribution). These 45 jokes were randomly intermixed.
The Low and High conditions were oversampled since the
HighLow comparison is the test of bias in this setting – i.e., whether the
participants would report their post-consumption preference rating
differently after being exposed to High vs. Low rating from the
system. The Medium condition is included so that the presented
ratings could cover the entire spectrum of the 1-5 rating scale; this
helps to avoid possible credibility issues caused by bipolar
recommendations (i.e., having either very high or very low ratings
displayed). The responses to the Medium rating items are only
useful in addressing the more peripheral issue of whether there is
asymmetry in the bias between the High and Low ranges
(comparing the difference of differences between High-Medium
and Medium-Low), an issue that is not addressed by this paper.
Hence, the Medium ratings are not analyzed here.</p>
      <p>Finally, participants completed a short survey that collected
demographic and some other individual information for use in the
analyses (e.g., see Table 2 for demographics).</p>
    </sec>
    <sec id="sec-5">
      <title>3.2 Results</title>
      <p>
        The pairwise t-test comparisons for the High and Low treatments
are illustrated in Figure 1. Both aggregate and personalized ratings
generate substantial effects on post-consumption preference
ratings. Users reported significantly inflated preference ratings in
the high conditions as compared to the low conditions (by more
than a half-star on average, overall). This result for the
personalized ratings is consistent with prior results
        <xref ref-type="bibr" rid="ref2">(e.g.,
Adomavicius et al. 2013)</xref>
        . The result for the aggregate ratings
addresses research issue (1): Even though the two types of
recommendation represent very different information, they both
tend to generate biases of preference ratings.
      </p>
      <p>With respect to research issue (2), we note that the two Low
conditions (Low personalized ratings vs. Low aggregate ratings) do
not significantly differ, and that the same holds for the two High
conditions. This provides evidence that aggregate and personalized
ratings, when presented individually, generate similar levels of
preference bias.
To get a more direct answer for research issue (2), with controls for
possible confounding factors, we also employed regression
analysis. Specifically, the repeated-measures design of the
experiment, wherein each participant was exposed to both high and
low ratings in a random fashion, allows us to model the aggregate
relationship between shown ratings (either personalized or
aggregate) and user’s submitted post-consumption preference
ratings while controlling for individual participant differences.
While we do not include the full regression analysis here due to the
space limitations, the results confirm what we have observed in
Figure 1 – i.e., the social, population-level information provided by
aggregate ratings creates a level of bias comparable to that
produced by personalized recommendations despite their different
underlying mechanisms.</p>
    </sec>
    <sec id="sec-6">
      <title>4. STUDY 2: Combined Effects of Both</title>
    </sec>
    <sec id="sec-7">
      <title>Personalized and Aggregate Ratings</title>
    </sec>
    <sec id="sec-8">
      <title>4.1 Design</title>
      <p>We recognize that, in some instances, retailers provide both pieces
of information (personalized and aggregate ratings) as aids to the
consumer. Study 2 addresses research issue (3), i.e., the issue of
the combined effects of these two different types of ratings.
A US college’s research participant pool provided 55 participants
who were paid a fixed $10 fee for completing the study. None of
the participants from Study 1 were allowed to enroll in Study 2.
Demographic features of the sample are summarized in Table 2 for
the two groups (discussed below) of the between-subjects
component of the design. Participant characteristics are
comparable between the two treatment groups and to those in Study
1 drawn from the same population. The mean time for completing
the study was 29.97 minutes.
The objective of Study 2 is to examine the relative importance of
personalized vs. aggregate ratings when both types of information
are displayed, controlling for any order effects. Participants were
randomly assigned into one of two treatment groups. Participants
in both groups received both personalized and aggregate ratings for
each joke displayed to them. The first group received the
personalized rating first, followed by the aggregate rating (i.e., the
PersonalizedFirst group). The second group saw the ratings for
each joke in the reverse order (i.e., the AggregateFirst group).
The study followed a similar procedure as Study 1. Participants
first read 50 randomly selected jokes from a database of 100, being
asked to provide their preference for each joke using a 5-point
rating scale. Each participant was then asked to rate 45 additional
jokes along with both personalized and aggregate ratings displayed.
In both treatment groups, the 45 jokes were randomly assigned into
five within-subjects conditions. 40 of the jokes occupied a 22
within-subjects design crossing High and Low values of
personalized and aggregate ratings. 10 jokes were assigned to the
HighP-HighA condition that consisted of high values for both
personalized and aggregate ratings, 10 jokes to the LowP-LowA
condition that consisted of low values for both personalized and
aggregate ratings; 10 jokes to the LowP-HighA condition that
consisted of low personalized and high aggregate ratings, and 10
jokes to the HighP-LowA condition that consisted of high
personalized and low aggregate ratings. Similar to Study 1, all the
high values are randomly generated values between 3.5 and 4.5
stars, and all the low values are randomly generated values between
1.5 and 2.5 stars, drawn from a uniform distribution. The remaining
5 jokes were assigned to the Medium condition, which included
randomly generated values between 2.5 and 3.5 for both
personalized and aggregate ratings. As in Study 1, the Medium
condition was included simply to have a credible representation of
ratings from the entire spectrum of the 1-5 rating scale; the Medium
ratings are not used in any subsequent analyses in the paper. The
45 jokes were randomly intermixed.</p>
      <p>Finally, the participants were asked to complete a survey about their
demographic information and joke preferences.</p>
    </sec>
    <sec id="sec-9">
      <title>4.2 Results</title>
      <p>Figure 2 illustrates the mean self-reported preference ratings
submitted by Study 2 participants, for the cases when aggregate
ratings are shown first (Figure 2a) and when personalized ratings
are shown first (Figure 2b). Starting with the vertical line in each
diagram, we see a strongly significant difference between when
both personalized and aggregate ratings are high vs. when both
ratings are low, indicating a clear bias effect in both cases,
consistent with Study 1. The horizontal line in each figure indicates
a stronger impact of personalized ratings compared to aggregate
ratings when both appear together and signal in opposite directions
(one with a high recommendation and the other low). Thus, the
pairwise contrasts suggest that, when both types of ratings are
present, personalized recommendations seem to be taken into
account by users more strongly (and, hence, generate more
significant biases) than aggregate ratings regardless of the
presentation order.</p>
      <p>This pattern is also supported by the diagonal lines in Figure 2.
Beginning with the negatively sloped diagonals in the figure, i.e.,
when the aggregate rating goes from low to high, holding the
valence of the personalized prediction fixed, the effect is variable.
In each case, one of the comparisons is statistically significant, and
the other is not. Specifically, a low to high difference for aggregate
ratings is only observed when the aggregate ratings are preceded by
high personalized predictions (Figure 2b) or followed by low
personalized predictions (Figure 2a). In contrast, from the
comparisons indicated by the positively sloped diagonals in the
figure, i.e., when the personalized prediction goes from low to high,
holding the valence of the aggregate ratings fixed, we see a clear,
consistent, statistically significant biasing effect.</p>
      <p>By comparing Figures 1 and 2, one can observe that the High vs.
Low effect magnitudes are of around 0.55-0.72 when ratings are
displayed individually, and around 0.55-0.6 when two ratings are
displayed together. In other words, the preliminary evidence
suggests that the cumulative effect of both ratings is not greater than
the effect of either one of the ratings individually.
(a) Aggregate ratings are shown first:
(b) Personalized predictions are shown first</p>
      <p>Note: ***p &lt; .001, ** p &lt; .01, * p &lt; .05, † p &lt; .10, [----] p &gt; .10
To test for the robustness of the combined effects of the two types
of ratings (as compared to when each rating is shown individually)
and to allow us to control for possible confounding factors, we
conduct regression analyses. To do so, we pool the conditions from
Studies 1 and 2 (that sampled from the same participant population)
to compare the effect sizes when different amounts of information
are presented to users. Recall that the High-Low comparison is the
test of bias in our setting. Therefore, we include all the
observations from Study 1, while for Study 2 we only consider the
cases when both high personalized and high aggregate ratings (i.e.,
HighP-HighA) and when both low personalized and low aggregate
ratings (i.e., LowP-LowA) are displayed to users. The
randomeffects GLS model using robust standard errors, clustered by
participant, and using participant-level controls represents our
model for the analysis:
UserRatingij = b0 + b1(Highij) + b2(Groupi) + b3(Highij*Groupi) +
b4(Deviationij) + b5(PredictedRatingij) +
b6(AdditionalControlsij) + ui + εij
In the model, UserRatingij is the submitted rating for participant i
on joke j. Highij is a binary variable that indicates whether the
shown rating for participant i on joke j is a high or low artificial
rating. Thus, the coefficient on Highij measures the difference in
user preference ratings between high and low conditions
(manipulated within-subjects), which is our operationalization of
bias. To the extent that users are influenced by the observed
information, their submitted preference ratings will be shifted up
when seeing High ratings and shifted down when seeing Low
ratings. Thus, the High/Low difference is an indicator of the bias
created by the observed information. AggregateDevij and
PersonalizedDevij are derived variables that capture the deviations
between the actually shown rating (aggregate and personalized,
respectively) for participant i on joke j and the expected value for
the shown ratings in the corresponding condition. Recall that the
two ratings seen by the participant were manipulated independently
to introduce randomness into the values for the high and low rating
conditions by drawing from uniform distributions: High [3.5, 4.5]
and Low [1.5, 2.5]. Thus, the deviation variables are computed by
either subtracting 4.0 from the shown rating (High condition) or 2.0
from the shown rating (Low condition). Groupi denotes different
between-subject conditions with different information displays.
For Model 1, the groups are AggregateOnly (from Study 1) and the
two order conditions from Study 2: AggregateFirst and
PersonalizedFirst. For Model 2, the AggregateOnly condition is
replaced by the PersonalizedOnly condition. We also include the
interaction term between Groupi with the rating value (i.e.,
Highij*Groupi). The interaction term examines whether the effect
size of showing high vs. low information differs among groups.
PredictedRatingij is the system-predicted rating for participant i on
joke j, calculated after the fact.1 The inclusion of this term provides
an important control for differing expected joke preferences among
participants. The collection of the ratings on the first 50 jokes in
the procedure (without recommendations) allowed us to calculate
these predicted ratings for all subjects. AdditionalControlsij is a
vector of joke and participant-related variables. The controls
included in the model were: the joke’s funniness (average joke
rating in the Jester dataset, continuous between 0 and 5), participant
age (integer), gender (binary), school level (undergrad yes/no
binary), whether they are native speakers of English (yes/no
binary), whether they thought recommendations in the study were
accurate (interval five-point scale), whether they thought the
recommendations in the study were useful (interval five-point
scale), and whether they thought that recommendations in general
were useful (interval five-point scale).</p>
      <p>
        The study utilized a repeated-measures design with a balanced
number of observations on each participant. To control for
participant-level heterogeneity, the composite error term (ui + εij)
includes the individual participant effect ui and the standard
disturbance term εij. A random-effects model is used for participant
heterogeneity, since these individual-specific effects are
uncorrelated with the randomly applied treatment conditions.
Table 3 summarizes our pooled regression analyses. The models
are analyzed separately to allow us to use a full set of control
variables for each regression model. Model 1 includes the
conditions in which aggregate ratings are displayed, i.e.,
AggregateOnly from Study 1, and the HighP-HighA and
LowPLowA conditions from Study 2. Model 2 includes the conditions
1 We applied the well-known item-based collaborative filtering (CF) technique
        <xref ref-type="bibr" rid="ref15 ref5">(Deshpande and Karypis 2004; Sarwar et al. 2001)</xref>
        to implement a recommender
system that estimated users’ preference ratings for the jokes. Item-based CF is one
of the most popular techniques used in real-world applications because of its
in which personalized predictions are displayed, i.e.,
PersonalizedOnly from Study 1 and the HighP-HighA and
LowPLowA conditions from Study 2.
      </p>
      <p>Interestingly, in both models, the interaction term Highij*Groupi is
statistically insignificant. There is no evidence that the effect size
measured in high-low difference differs among groups with
different information displays. In other words, when aggregate and
personalized ratings are presented together (as explored in Study 2)
regardless of their order, there is no evidence that they increase
preference biases compared to displaying either aggregate or
personalized recommendations alone. In other words, our results
suggest a substitutionary effect between personalized and
aggregate ratings on users’ self-reported preferences (so that the
cumulative effect is no greater than the effect of only one).</p>
    </sec>
    <sec id="sec-10">
      <title>5. STUDY 3: Recommendation List Effects</title>
    </sec>
    <sec id="sec-11">
      <title>5.1 Design</title>
      <p>In Studies 1 and 2, the recommendations were presented to users as
values along a 1-5 scale. As noted earlier, another common format
for providing recommendations is in the form of lists of
recommended items. The numeric values corresponding to the list
items often are not displayed, even when these recommendations
are generated by selecting items based on the personalized rating
efficiency and accuracy. This technique allows us to precompute the main portion
of our recommendation model (i.e., the similarity scores between items based on
their rating patterns) in advance based on the extensive Jester rating dataset.
predictions or aggregate peer rating values. In Study 3, we examine
whether the recommendations (based on either aggregate or
personalized ratings) presented as a list of top-N items can lead to
bias in users’ reported preference ratings. Doing so explores the
generalizability of the results of Studies 1 and 2, addressing
research issue (4): As a non-numerical format (derived from
numerical information), when compared to explicitly provided
numeric ratings, do top-N recommendation lists create bias in
users’ self-reported post-consumption preference ratings?
Recruited from the same population as for Studies 1 and 2, 184 new
participants were paid a fixed $10 fee for completing the study.
Table 4 shows demographic features of the sample across all
conditions of the between-subjects component of the design.
Participant characteristics are comparable to those of Studies 1 and
2. The mean time for completing the study was 20.13 minutes.
The procedure followed that used in Studies 1 and 2. Participants
first went through a list of 50 randomly selected jokes from the 100
jokes in the database, providing ratings using the 5-point rating
scale. Participants then saw 20 additional jokes displayed as a list,
and they rated the jokes using the same 5-point rating scale.
Finally, the participants were asked to complete a survey about
demographic information and joke preferences.</p>
      <p>
        Each participant was randomly assigned into one of five treatment
groups: Random, Personalized-Random, Personalized-Best,
Aggregate-Random, and Aggregate-Best. Table 5 summarizes the
five conditions and the number of respondents in each condition.
In the Random condition, participants were told that the additional
20 jokes were randomly selected from an existing database and
displayed in no particular order, and these jokes were indeed
random selections from the database in the actual
operationalization. For the two personalized conditions, both
groups of participants were told that the item list contains the top
jokes selected by a recommender system based on their
preferences. The difference between Personalized-Random and
Personalized-Best lies in the actual operationalization of selecting
the jokes. In the Personalized-Random condition, the jokes
displayed to the participants were actually randomly selected jokes
from the database. In the Personalized-Best condition, the jokes
were the actual top 20 jokes that had the highest predicted ratings
estimated by the well-known item-based collaborative filtering
recommendation algorithm
        <xref ref-type="bibr" rid="ref15 ref5">(Deshpande and Karypis 2004; Sarwar
et al. 2001)</xref>
        . Similarly, for the two aggregate conditions, both
groups of participants were told that the item list contains the top
jokes selected according to aggregate user ratings on these jokes.
In the Aggregate-Random condition, the jokes displayed to the
participants were actually randomly selected jokes from the
database. In the Aggregate-Best condition, the jokes were the
actual top 20 jokes that had the highest mean user ratings based on
the Jester dataset. To control for joke funniness, we displayed the
same list of 20 jokes to all participants in the Personalized-Random,
Aggregate-Random and Random conditions, albeit the display
order was shuffled for each person.
      </p>
    </sec>
    <sec id="sec-12">
      <title>5.2 Results</title>
      <p>Figure 3 illustrates the pairwise t-tests that compare mean user
submitted ratings for the experimental conditions. When random
jokes were provided, identifying the jokes as recommended, either
based on system predictions (Personalized-Random) or aggregate
ratings (Aggregate-Random), did not lead to significantly higher
user ratings compared with the Random group. In other words, the
top-N information presentation format did not introduce bias in
users’ submitted ratings. Figure 3 also suggests that the consumers
were not just generally insensitive. On average, participants who
received actual top-N lists, either based on personalized
(Personalized-Best) or aggregate ratings (Aggregate-Best),
provided significantly higher ratings on these items than
participants who received random recommendations. Note that, in
this case, such rating differences are not necessarily indicative of
bias in user preferences, since the jokes displayed in the
Personalized-Best and Aggregate-Best conditions were likely
better jokes for the participants.
The system- predicted rating represents the rating of a user-joke
combination as predicted by the recommendation algorithm (an
item-based collaborative filtering method, in our case). Submitted
rating is the user’s reported rating after reading the joke. So,
positive/negative rating drift values represent situations where the
user’s submitted rating was higher/lower than the system-predicted
rating. In that the predicted rating captures a valid indicator of
user’s preferences based on their initial joke responses (which has
been demonstrated in prior work, e.g., by Adomavicius et al.
(2013)), rating drift is a measure that removes a component of
individual preference from the user rating, leaving a measure that
is more representative of possible bias (though still not pure, since
the predicted ratings are not 100% accurate). Still, the contrast
ttests of rating drift across treatments in Study 3 are highly
illuminative, as illustrated by Figure 4. As observed, rating drifts
for all five experimental groups had small values that ranged from
-0.012 to 0.065, suggesting that user-submitted ratings were
statistically indistinguishable from system-predicted ratings. Also,
the differences in rating drifts between Random and any treatment
group were insignificant, suggesting that item lists presented in
different ways (i.e., based on personalized recommendations,
aggregate user ratings, or random lists) did not pull users away from
their preferences as captured by the system-predicted ratings.
Note: [----] p &gt; .05</p>
    </sec>
    <sec id="sec-13">
      <title>6. CONCLUSIONS</title>
      <p>
        Prior research has shown that system recommendations can impact
users’ self-reported preference ratings, which can have deleterious
effects
        <xref ref-type="bibr" rid="ref2 ref4">(Cosley et al. 2003; Adomavicius et al. 2013)</xref>
        . We extend
this stream of research to investigate the decision biases introduced
by aggregate peer ratings on users’ post-consumption preference
ratings. Through laboratory experiments, we first demonstrate that
the self-reported preference rating (for a specific consumed item)
can be strongly biased not only by observing personalized,
systempredicted ratings, but also non-personalized, aggregate user ratings.
We further demonstrate that, when personalized and aggregate
ratings are displayed together, there is no cumulative increase in
effect and that users tend to focus more attention on personalized
ratings. Finally, we show that alternative recommendation displays
that use top-N lists instead of individual item rating information
seem to greatly reduce, if not remove, the biases observed in prior
studies – in other words, this format appears to be a promising
alternative for recommending items to users without introducing
decision biases. This may be because top-N lists do not include
explicit values (i.e., the individual system-predicted ratings or
aggregate user ratings), which are likely causing the biases
observed in prior studies. These results provide several obvious
practical implications for the design of recommender system and
online retail interfaces and displays.
      </p>
    </sec>
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