Description of the project and research questions being asked
A less technical description can be found here: http://advertisingtokids.org/#Problem
Children are big business in this country. While teenagers may be the “big get” at $100 billion a year, children under the age of twelve still spend about $28 billion (McNeal, 1999). It is no surprise that businesses want to influence their purchasing decisions with advertising.
Currently there are few regulations on content in advertising directed at children beyond the general restrictions (that apply to everyone). Instead the FCC has focused more, through the Children’s Television Act of 1990, on the amount of advertising (currently 10.5 minutes per hour on weekends, 12 minutes on weekdays per hour) and required educational programming (three hours a week). But is quantity the right thing to be concerned with?
Rebecca Saxe (2010) suggests that the way you or I process advertising may be very different from a child. This suggests that the content of the advertisement should be the focus of policy makers.
This forms the basis of my question: Will the effectiveness (as defined by transaction behavior) of bombastic (or exaggerated) advertising be inversely related to the age of the child? It is my intent, using experimental economics, to test children’s (ages 5–10) purchasing behavior in a simulated transaction after seeing one of two commercial types (and one control group who will see no commercials, this is to control for other age effects). My hypothesis is that the increased effectiveness (vs control) of the bombastic commercials versus more factual commercials will be highly correlated to their age. While children of all ages will be trying to maximize their expected utility function by choosing the optimal product, the children’s right temporo-parietal junction (rTPJ) is a parameter in their decision process and it will change the child’s perception of the products’ expected utility.
If my hypothesis is correct, and others can replicate it using differing methodologies, I believe it has obvious implications to the adequacy of current advertising regulations.
Why this matters and should be exciting to backers
If children can't determine when an advertiser is exaggerating, it isn't a theoretical problem: Both Atkin and Heald (1977) and Krunkel and Gantz (1992) found that toy commercials, in particular, were almost always unrealistically exaggerated.
Additionally, a large portion of the commercials young children see are fast-food related (Holt et al., 2007), which means this research could also have implications for childhood obesity.
What your money can do ... Run an Experiment
Instead of asking what the child might do or attempting to interpret their intent, we want to just give them a choice of products (which they then get to keep). This eliminates a large number of sources of error, however it is really expensive.
The basic concepts of the experiment are outlined here:
And the costs are outlined here:
If we get more money than the minimum, we will increase our sample size.
By the end of the experiment we should know if age is a significant factor in determining the expected utility of product. That's huge! If that's true we need to think about, not only the quantity of advertising, but the messaging.
I'm a Ph.D. student at Washington State University doing research in behavioral economics. Current topics include firm geographic grouping, the nature of expertise (using twitter data), modeling a representative protester and the imputes to overthrow a government, mixed media pricing model for advertising, and of course, kids' perception of advertising. I'm fascinated by behavior in response to advertising; particularly amongst children. We show our kids a lot of advertising, but what happens when they can't detect an exaggeration? The policy implications are huge.
Main site: http://advertisingtokids.org
More technical proposal: http://advertisingtokids.org/proposal.pdf