Disclosure of odds information: An experimental investigation of odds format and numeric complexity

Although disclosure of odds information is ubiquitous in the marketplace, no public policy initiatives have been implemented regarding the manner in which odds information should be disclosed. Considering that behavioral decision research has shown that the format of information affects consumers' processing and evaluation of that information, simply making odds available to consumers in the marketplace does not guarantee that this information is processable or that it aids consumer decision making. After investigating marketplace practices regarding the disclosure of odds information, the authors establish in the first study - an experiment building on basic decision research - that the number-colonnumber (i.e., "1:10") and the phrase (i.e., "One in 10") formats outperform the decimal (i.e., "0.1") format, regardless of the numeric complexity or magnitude of the odds information. In the second experiment, the authors investigate a more readily processed format (i.e., a sentence explaining the odds), which is found to increase consumers' understanding of odds disclosures when presented as a low-complexity number. Implications for public policymakers include several trade-offs that must be made between information provision and cost, as well as between accuracy and processability.