This Harvard Business School paper confirms a phenomenon most Netflix renters are familiar with. People feel like they should rent Citizen Kane or Born Into Brothels, but those DVDs sit on the TV collecting dust while rentals like Must Love Dogs or Mr. and Mrs. Smith get watched and returned lickety-split.
The study notes, however, that this disparity lessens over time as people finally realize that what they want is not to have to think.
We predict and find that people are more likely to rent DVDs in one order and return them in the reverse order when should DVDs (e.g., documentaries) are rented before want DVDs (e.g., action films). This effect is sizeable in magnitude, with a 2% increase in the probability of a reversal in preferences (from a baseline rate of 12%) ensuing if the first of two sequentially rented movies has more should and fewer want characteristics than the second film. Similarly, we also predict and find that should DVDs are held significantly longer than want DVDs within-customer. Finally, we find that as the same customers gain more experience with online DVD rentals, their “dynamic inconsistency