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Article
An Experimental Examination of Heuristic-Based Decision-Making in a Financial Setting
Faculty Publications
  • Lucy F. Ackert, Kennesaw State University and Federal Reserve Bank of Atlanta
  • Bryan K. Church, Georgia Institute of Technology - Main Campus
  • Paula Tkac, Federal Reserve Bank of Atlanta
Department
Economics, Finance, & Quantitative Analysis
Document Type
Article
Publication Date
1-1-2010
Abstract
This paper reports the results of an experiment designed to examine information acquisition and evaluation in a financial setting, predicting mutual fund performance. We compare behavior across four distinct subject pools to provide insight into how training, knowledge, and experience affect decision making. We manipulate the decision environment by first increasing the time constraint and then increasing the decision cost. Although we find differences in behavior across subject pools, subjects' performance is similar. Outcomes are similar across the distinct subject pools, despite significant differences in financial education.
Citation Information
Ackert, Lucy F., Bryan K. Church, and Paula A. Tkac. "An Experimental Examination of Heuristic-Based Decision Making in a Financial Setting." Journal of Behavioral Finance 11.3 (2010): 135-149.