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Behavioral Economics and the Halo Effect


It is widely known that people are not perfect at judging. A lot of factors are involved in our ratings and decisions (for example, framing). Regarding those factors, a quite famous phenomenon is the halo effect.

What is the halo effect?

Established by Thorndke, the halo is referring to the phenomenon where people, having a positive opinion about a person’s trait, are generalizing this positive opinion in all of the person’s characteristics, even though they can be unrelated (Srajal, 2011).

For example, when we see someone who’s really good at math, we might hypothesize that this person is also good in other unrelated courses (history, literature), without knowing its performance on these courses. (Srajal, 2011). The halo effect is a substructure of the confirmation bias (Srajal, 2011), which refers to the tendency people have to interpret information according to their existing thoughts or experiences and thereby, not paying enough attention to alternatives.

Why does the halo effect occur?

According to Leuthesser, Kohli & Harich (1995), the halo effect is the result of cognitive consistency. Cognitive consistency underlines that people try to have a consistent scheme of beliefs. Simply put, we try to group beliefs according to their value (positive, negative, ugly, beautiful and so on).

So if we consider a person good on a sector, we group all of its characteristics as good, in order for cognitive consistency to occur. That is happening because, according to Leuthesser, Kohli & Harich (1995), cognitive inconsistency causes uncomfortable stress, so that’s why people usually attempt to eliminate such inconsistencies.

Where is the halo effect present?

One of the factors that are supposed to trigger halos is attractive looks. That’s why in many advertisements beautiful people are used, even though they have no authenticity on what they’re advertising (Srajal, 2011). Politics are also affected, since a lot of actors and athletes are elected, based on the fame and adoration they acquired in their respective fields (Srajal, 2011).

The halo effect is not only apparent on people, but also on products and brands. A quite interesting example is the impression people have about the products of a country, based on the country’s image. Han (1989) states that, when consumers are not familiar with a country’s products, they tend to evaluate them by the country’s whole image (whether that’s good or bad).


The halo effect is one of the cognitive shortcuts of the human mind regarding the procedure of evaluating. Even though the ease to judge based on superficial and irrelevant traits seems convenient and seductive, it would be beneficial to consider many factors before we decide to judge someone or something.

Did you ever form halos? For which sectors do you thing they form more frequently? Share your opinion freely!


Christos Panousis

Researcher and writer for Nudge Unit Greece

~Explaining Behavioral Economics Simply~


Han, C. M. (1989). Country image: halo or summary construct?. Journal of marketing research, 26(2), 222.

Leuthesser, L., Kohli, C. S., & Harich, K. R. (1995). Brand equity: the halo effect measure. European Journal of Marketing, 29(4), 57-66.

Nayak, Srajal (2011). Are we rational Voters?: A study of “halo-effects”. Indian Institute of Technology, Fanpur. Retrieved on 7 February 2016 from


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