Determinants of Risk Taking in a Dynamic Uncertain Context

2002 ◽  
Vol 28 (1) ◽  
pp. 89-106 ◽  
Author(s):  
Jeffrey P. Slattery ◽  
Daniel C. Ganster
Keyword(s):  
Decision Making ◽  
Risk Taking ◽  
Goal Attainment ◽  
Decision Makers ◽  
Complex Dynamic ◽  
Managerial Decision ◽  
Risky Decision ◽  
Dynamic Task ◽  
Outcome Feedback ◽  
Uncertain Outcomes

We tested the effects of positive and negative framing on risky decision making in a simulated managerial judgement task. Until now the extensive research on framing effects has been characterized by static contexts, explicit probabilities, and hypothetical gambles. In contrast we simulated a more realistic decision making environment in which individuals chose more or less risky goals in a complex dynamic task that featured uncertain outcomes and meaningful consequences. Decision makers chose a series of performance goals under conditions of either potential losses or gains and also received feedback about their goal attainment. Our results failed to replicateProspect Theory predictions about initial gain vs.loss framing typically found in static decision making contexts. In addition, we tested competing hypotheses derived from Prospect Theory and Quasi-Hedonic Editing (QHE) Theory about the effects of performance outcome feedback on subsequent decisions. Consistent with QHE Theory, decision makers who had failed to reach their goals set lower, less risky goals in subsequent decisions. Our findings illustrate the need for further risk taking research in environments that more closely resemble managerial decision making.

Hot and cold cognition in risky decision making: Accounting for age and gender differences in risk taking

2006 ◽  
Author(s):  
Bernd Figner ◽  
Rachael J. Mackinlay ◽  
Friedrich Wilkening ◽  
Ryan O. Murphy ◽  
Elke U. Weber
Keyword(s):  
Gender Differences ◽  
Decision Making ◽  
Risk Taking ◽  
Risky Decision Making ◽  
Risky Decision ◽  
Age And Gender ◽  
Age And Gender Differences ◽  
And Gender

scholarly journals Trade-Control Compliance in SMEs: Do Decision-Makers and Supply Chain Position Make a Difference?

2021 ◽  
Author(s):  
Christian Hauser
Keyword(s):  
Decision Making ◽  
Decision Makers ◽  
Behavioral Ethics ◽  
Managerial Decision ◽  
Organizational Responses ◽  
Control Laws ◽  
Compliance Programs ◽  
External Pressures ◽  
Compliance Program ◽  
Trade Control

AbstractIn recent years, trade-control laws and regulations such as embargoes and sanctions have gained importance. However, there is limited empirical research on the ways in which small- and medium-sized enterprises (SMEs) respond to such coercive economic measures. Building on the literature on organizational responses to external demands and behavioral ethics, this study addresses this issue to better understand how external pressures and managerial decision-making are associated with the scope of trade-control compliance programs. Based on a sample of 289 SMEs, the findings show that the organizational responses of SMEs reflect proportionate adjustments to regulatory pressures but only if decision-makers are well informed and aware of the prevailing rules and regulations. Conversely, uninformed decision-making leads to a disproportionate response resulting in an inadequately reduced scope of the compliance program. In addition, the results indicate that SMEs that are highly integrated into supply chains are susceptible to passing-the-buck behavior.

Jumping to conclusions – an analysis of the NBA Draft Combine athleticism data and its influence on managerial decision-making

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Tobias Berger ◽  
Frank Daumann
Keyword(s):  
Decision Making ◽  
Design Methodology ◽  
Predictive Power ◽  
Principal Component ◽  
Decision Makers ◽  
Decision Quality ◽  
Managerial Behavior ◽  
Managerial Decision ◽  
Content Type ◽  
Selection Behavior

PurposeThe NBA Draft policy pursues the goal to provide the weakest teams with the most talented young players to close the gap to the superior competition. But it hinges on appropriate talent evaluation skills of the respective organizations. Research suggests the policy might be valid but to date unable to produce its intended results due to the “human judgement-factor”. This paper investigates specific managerial selection-behavior-influencing information to examine why decision-makers seem to fail to constantly seize the opportunities the draft presents them with.Design/methodology/approachAthleticism data produced within the NBA Draft Combine setting is strongly considered in the player evaluations and consequently informs the draft decisions of NBA managers. Curiously, research has failed to find much predictive power within the players pre-draft combine results for their post-draft performance. This paper investigates this clear disconnect, by examining the pre- and post-draft data from 2000 to 2019 using principal component and regression analysis.FindingsEvidence for an athletic-induced decision-quality-lowering bias within the NBA Draft process was found. The analysis proves that players with better NBA Draft Combine results tend to get drafted earlier. Controlling for position, age and pre-draft performance there seems to be no proper justification based on post-draft performance for this managerial behavior. This produces systematic errors within the structure of the NBA Draft process and leads to problematic outcomes for the entire league-policy.Originality/valueThe paper delivers first evidence for an athleticism-induced decision-making bias regarding the NBA Draft process. Informing future selection-behavior of managers this research could improve NBA Draft decision-making quality.

Modeling the Effects of Sleep Deprivation on Real-Time Risky Decision-Making

1998 ◽  
Vol 42 (3) ◽  
pp. 330-334
Author(s):  
Joshua B. Hurwitz
Keyword(s):  
Decision Making ◽  
Risk Perception ◽  
Real Time ◽  
Risk Taking ◽  
Time Of Day ◽  
Risky Decision Making ◽  
Risky Decision ◽  
Distance Information ◽  
Driving Task ◽  
Response Choices

Increased real-time risk-taking under sleep loss could be marked by changes in risk perception or acceptance. Risk-perception processes are those involved in estimating real-time parameters such as the speeds and distances of hazardous objects. Risk-acceptance processes relate to response choices given risk estimates. Risk-taking under fatigue was studied using a simulated intersection-crossing driving task in which subjects decided when it was safe to cross an intersection as an oncoming car approached from the cross street. The subjects performed this task at 3-hour intervals over a 36-hour period without sleep. Results were modeled using a model of real-time risky decision making that has perceptual components that process speed, time and distance information, and a decisional component for accepting risk. Results showed that varying a parameter for the decisional component across sessions best accounted for variations in performance relating to time of day.

Technology Imperative in Managerial Decision-Making

2014 ◽  
pp. 158-176 ◽  
Author(s):  
Neeta Baporikar
Keyword(s):  
Decision Making ◽  
Decision Makers ◽  
Limited Information ◽  
Managerial Decision ◽  
Managerial Decision Making ◽  
Face To Face ◽  
The Core ◽  
Use Of Technology ◽  
Management Approaches ◽  
Virtual Setting

Decisions can make or mar an organization. Decision-making is a multifaceted and intricate process. This process becomes even more complicated and complex when it comes to organizations, especially in this competitive world. Today, decisions are made not only under uncertainty, with available and/or limited information, but may also be made in a virtual setting. Decision makers may not be engaged in face-to-face deliberations. Hence, understanding the challenges, complexity, and rewards of the use of technology, especially information technology in managerial decision-making, is important. Such an understanding is not only vital in determining the efficacy of managers and their organizations, but also significant in designing future management approaches and organizations. This is the core objective of this chapter.

scholarly journals Modernizing Conceptions of Valuation and Cognitive-Control Deployment in Adolescent Risk Taking

2019 ◽  
Vol 29 (1) ◽  
pp. 102-109 ◽  
Author(s):  
Kathy T. Do ◽  
Paul B. Sharp ◽  
Eva H. Telzer
Keyword(s):  
Decision Making ◽  
Control System ◽  
Cognitive Control ◽  
Computational Model ◽  
Risk Taking ◽  
Expected Value ◽  
Risky Decision Making ◽  
Risky Decision ◽  
Adolescent Risk ◽  
Risk Taking Behavior

Heightened risk taking in adolescence has long been attributed to valuation systems overwhelming the deployment of cognitive control. However, this explanation of why adolescents engage in risk taking is insufficient given increasing evidence that risk-taking behavior can be strategic and involve elevated cognitive control. We argue that applying the expected-value-of-control computational model to adolescent risk taking can clarify under what conditions control is elevated or diminished during risky decision-making. Through this lens, we review research examining when adolescent risk taking might be due to—rather than a failure of—effective cognitive control and suggest compelling ways to test such hypotheses. This effort can resolve when risk taking arises from an immaturity of the control system itself, as opposed to arising from differences in what adolescents value relative to adults. It can also identify promising avenues for channeling cognitive control toward adaptive outcomes in adolescence.

scholarly journals Risky Multi-Attribute Decision-Making Method Based on the Interval Number of Normal Distribution

Symmetry ◽  
2020 ◽  
Vol 12 (2) ◽  
pp. 264
Author(s):  
Sha Fu ◽  
Xi-Long Qu ◽  
Ye-Zhi Xiao ◽  
Hang-Jun Zhou ◽  
Guo-Bing Fan
Keyword(s):  
Decision Making ◽  
Normal Distribution ◽  
Interval Number ◽  
Information Environment ◽  
Decision Makers ◽  
Standard Normal Distribution ◽  
Risky Decision ◽  
Possibility Degree ◽  
Standard Normal ◽  
Multi Attribute Decision Making

Focusing on risky decision-making problems taking the interval number of normal distribution as the information environment, this paper proposes a decision-making method based on the interval number of normal distribution. Firstly, the normalized matrix based on the decision maker’s attitude is obtained through analysis and calculation. Secondly, according to the existing properties of standard normal distribution, the risk preference factors of the decision makers are considered to confirm the possibility degree of each scheme. The possibility degree is then used for establishing a possibility degree matrix and, consequently, sequencing of all schemes is conducted according to existing theories of possibility degree meaning and the value size of possibility degree. Finally, the feasibility and validity of this method is verified through calculation example analysis.

scholarly journals Heightened Adolescent Risk-Taking? Insights From Lab Studies on Age Differences in Decision-Making

2019 ◽  
Vol 6 (1) ◽  
pp. 56-63 ◽  
Author(s):  
Ivy N. Defoe ◽  
Judith Semon Dubas ◽  
Daniel Romer
Keyword(s):  
Decision Making ◽  
Age Differences ◽  
Risk Taking ◽  
Real World ◽  
Meta Analysis ◽  
Risky Decision Making ◽  
Risky Decision ◽  
Neuropsychological Development ◽  
Integrative Framework ◽  
Adolescent Risk

Surveys concur that adolescents disproportionately engage in many real-world risk behaviors, compared with children and adults. Recently researchers have employed laboratory risky decision-making tasks to replicate this apparent heightened adolescent risk-taking. This review builds on the main findings of the first meta-analysis of such age differences in risky decision-making in the laboratory. Overall, although adolescents engage in more risky decision-making than adults, adolescents engage in risky decision-making equal to children. However, adolescents take fewer risks than children on tasks that allow the option of opting out of taking a risk. To reconcile findings on age differences in risk-taking in the real-world versus the laboratory, an integrative framework merges theories on neuropsychological development with ecological models that emphasize the importance of risk exposure in explaining age differences in risk-taking. Policy insights and recent developments are discussed.

scholarly journals Chimpanzees (Pan troglodytes) Are More Averse to Social Than Nonsocial Risk

2018 ◽  
Vol 30 (1) ◽  
pp. 105-115 ◽  
Author(s):  
Sarah E. Calcutt ◽  
Darby Proctor ◽  
Sarah M. Berman ◽  
Frans B. M. de Waal
Keyword(s):  
Decision Making ◽  
Pan Troglodytes ◽  
Risk Taking ◽  
Trust Game ◽  
Risk Attitudes ◽  
Social Risk ◽  
Risky Decision ◽  
Emotional Factors ◽  
Economic Decision Making ◽  
Tit For Tat

Social risk is a domain of risk in which the costs, benefits, and uncertainty of an action depend on the behavior of another individual. Humans overvalue the costs of a socially risky decision when compared with that of purely economic risk. Here, we played a trust game with 8 female captive chimpanzees ( Pan troglodytes) to determine whether this bias exists in one of our closest living relatives. A correlation between an individual’s social- and nonsocial-risk attitudes indicated stable individual variation, yet the chimpanzees were more averse to social than nonsocial risk. This indicates differences between social and economic decision making and emotional factors in social risk taking. In another experiment using the same paradigm, subjects played with several partners with whom they had varying relationships. Preexisting relationships did not impact the subjects’ choices. Instead, the apes used a tit-for-tat strategy and were influenced by the outcome of early interactions with a partner.

Stressed decision makers and use of decision aids: a literature review and conceptual model

2019 ◽  
Vol 33 (2) ◽  
pp. 710-754 ◽  
Author(s):  
Monica Adya ◽  
Gloria Phillips-Wren
Keyword(s):  
Decision Making ◽  
Conceptual Model ◽  
Perceived Stress ◽  
Decision Aids ◽  
Decision Makers ◽  
Decision Quality ◽  
Negative Effects ◽  
Managerial Decision ◽  
Content Type ◽  
The Impact

Purpose Decision making is inherently stressful since the decision maker must choose between potentially conflicting alternatives with unique hazards and uncertain outcomes. Whereas decision aids such as decision support systems (DSS) can be beneficial in stressful scenarios, decision makers sometimes misuse them during decision making, leading to suboptimal outcomes. The purpose of this paper is to investigate the relationship between stress, decision making and decision aid use. Design/methodology/approach The authors conduct an extensive multi-disciplinary review of decision making and DSS use through the lens of stress and examine how stress, as perceived by decision makers, impacts their use or misuse of DSS even when such aids can improve decision quality. Research questions examine underlying sources of stress in managerial decision making that influence decision quality, relationships between a decision maker’s perception of stress, DSS use/misuse, and decision quality, and implications for research and practice on DSS design and capabilities. Findings The study presents a conceptual model that provides an integrative behavioral view of the impact of a decision maker’s perceived stress on their use of a DSS and the quality of their decisions. The authors identify critical knowledge gaps and propose a research agenda to improve decision quality and use of DSS by considering a decision maker’s perceived stress. Originality/value This study provides a previously unexplored view of DSS use and misuse as shaped by the decision and job stress experienced by decision makers. Through the application of four theories, the review and its findings highlight key design principles that can mitigate the negative effects of stressors on DSS use.

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