Growth and Decline of Assets: On Biased Judgments of Asset Accumulation and Investment Decisions

Gonzalez, Nichel; Svenson, Ola

doi:10.2478/ppb-2014-0005

Cited by 3 publications

(1 citation statement)

References 15 publications

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“…When people are asked to provide numeric estimates of capital accumulations after a series of annual changes they tend to underestimate the accumulated financial growth even when they are to assume they have enough funds to cushion potential losses (Gonzalez and Svenson, 2014). People's responses thus rely on their subjective experience with and understanding of financial fluctuations and wealth.…”

Section: Introductionmentioning

confidence: 99%

Experimental Investigation on the Elicitation of Subjective Distributions

2019

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Elicitation methods aim to build participants' distributions about a parameter of interest. In most elicitation studies this parameter is rarely known in advance and hinders an objective comparison between elicitation methods. In two experiments, participants were first presented with a fixed random sequence of images and numbers and subsequently their subjective distributions of percentages of one of those numbers was elicited. Importantly, the true percentage was set in advance. The first experiment tested whether receiving instructions as to the elicitation method would assist in estimating a true value more accurately than receiving no instructions and whether accuracy was determined by the numerical skills of the participants. The second experiment sought to compare the elicitation method used in the first experiment with a variation of a graphical elicitation method. The results indicate that (i) receiving instructions as to the elicitation method does assist in producing estimates closer to a true percentage value, (ii) the level of numerical skills does not play a part in the accuracy of the estimation (Experiment 1), and (iii) although the average estimates of the betting and graphical method are not significantly different, the betting method leads to more precise estimations than the graphical method (Experiment 2). Both studies featured statistical procedures (functional data analysis and a novel clustering technique) not considered in past research on the elicitation of subjective distributions. The implications of these results are discussed in relation to a recent key study.

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Section: Introductionmentioning

confidence: 99%

Experimental Investigation on the Elicitation of Subjective Distributions

2019

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Different investors–different decisions: On individual use of gain, loss and interest rate information

Gonzalez

2017

Journal of Behavioral and Experimental Finance

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A note on judgments and behavior: Distancing and Corona virus exposure

Svenson,

Duce Gimeno,

Nilsson

et al. 2024

Judgm. decis. mak.

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In a questionnaire, participants judged the increase in SARS-CoV-2 virus exposure when moving closer to an infected person. Earlier studies have shown that the actual increase in virus exposure is underestimated and the present study replicated and extended these studies. The primary purpose was to investigate to what extent questionnaire judgments about hypothetical situations can predict judgments and actual behavior in real physical space. Participants responded to a questionnaire and the same participants also took part in a parallel study that was conducted in a room with a mannequin representing a virus infected person. The earlier reported bias in the perception of exposure as a function of distance to a virus source was replicated in the questionnaire and the physical laboratory study. A linear function connected median exposure judgments at the same distances from a virus source in the questionnaire and in the laboratory, R2 = 0.99. When asked to move to a distance that would give a prescribed exposure level, a linear function described the relationship between questionnaire distance judgments and moves to distances in the physical space, R2 = 0.95. We concluded that questionnaire data about perceived virus exposures are reliable indicators of real behavior. For health reasons, the significant underestimations of the steep increase of virus exposure during an approach to a virus source need to be stressed in communications to policy makers, the public, professionals working close to clients, nursing staff, and other care providers.

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Growth and Decline of Assets: On Biased Judgments of Asset Accumulation and Investment Decisions

Cited by 3 publications

References 15 publications

Experimental Investigation on the Elicitation of Subjective Distributions

Experimental Investigation on the Elicitation of Subjective Distributions

Different investors–different decisions: On individual use of gain, loss and interest rate information

A note on judgments and behavior: Distancing and Corona virus exposure

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