scholarly journals Social Comparisons are Associated with Poorer and Riskier Financial Decision Making, no Matter whether Encounters are Sporadic or Repeated

2016 ◽  
Vol 19 ◽  
Author(s):  
Alfonso Barrós-Loscertales ◽  
Antonio M. Espín ◽  
José C. Perales
Keyword(s):  
Decision Making ◽  
Social Interaction ◽  
Financial Risk ◽  
Social Comparisons ◽  
Social Conditions ◽  
Financial Decisions ◽  
The Social ◽  
Binary Choices ◽  
Social Encounters ◽  
Financial Decision

AbstractPrevious research suggests that social comparisons affect decision making under uncertainty. However, the role of the length of the social interaction for this relationship remains unknown. This experiment tests the effect of social comparisons on financial risk taking and how this effect is modulated by whether social encounters are sporadic or repeated. Participants carried out a computer task consisting of a series of binary choices between lotteries of varying profitability and risk, with real monetary stakes. After each decision, participants could compare their own payoff to that of a counterpart who made the same decision at the same time and whose choices/earnings did not affect the participants’ earnings. The design comprised three between-subjects treatments which differed in the nature of the social interaction: participants were informed that they would be matched with either (a) a different participant in each trial, (b) the same participant across all trials, or (c) a “virtual participant”, i.e., a computer algorithm. Compared to the non-social condition (c), subjects in both social conditions (a and b) chose lotteries with lower expected value (z = –3.10, p < .01) and higher outcome variance (z = 2.13, p = .03). However, no differences were found between the two social conditions (z = 1.15, p = .25 and z = 0.35, p = .73, respectively). These results indicate that social comparison information per se leads to poorer and riskier financial decisions, irrespective of whether or not the referent other is encountered repeatedly.

Effects of Perceived Scarcity on Financial Decision Making

2018 ◽  
Vol 37 (1) ◽  
pp. 68-87 ◽  
Author(s):  
Laurel Aynne Cook ◽  
Raika Sadeghein
Keyword(s):  
Decision Making ◽  
Financial Risk ◽  
Qualitative Data ◽  
Future Research ◽  
Policy Makers ◽  
Welfare Impact ◽  
Financial Decisions ◽  
Financial Decision ◽  
Influence Perceptions ◽  
Method Approach

How are financial decisions compromised as scarcity increases? Extant research focuses mostly on the consequences of financial scarcity; moreover, this factor is treated simply as a lack of liquidity. Using a mixed-method approach, the authors investigate the dimensions of perceived scarcity and the ways they work in tandem to negatively influence perceptions and decisions. Internal influences (including perceived consequences) and external influences (including decreased lending options) lead to results described in this article as the “triple scarcity effect.” Experimental results show how perceived financial scarcity undermines loan decisions, particularly for consumers at the greatest financial risk. Next, qualitative data collected from the Consumer Financial Protection Bureau are used for a between-method triangulation of the earlier findings. Understanding the multidimensionality of perceived financial scarcity is important for designing preventive measures that improve decisions (e.g., not reborrowing) and decision making (e.g., accurately calculating cost). Results from two interventions demonstrate how these improvements are made when consumers' perceptions of scarcity are reduced. Finally, the authors discuss the welfare impact for lenders, marketers, and policy makers, and they offer an agenda for future research.

scholarly journals How social network structure affects decision-making in Drosophila melanogaster

2016 ◽  
Vol 283 (1826) ◽  
pp. 20152954 ◽  
Author(s):  
Cristian Pasquaretta ◽  
Marine Battesti ◽  
Elizabeth Klenschi ◽  
Christophe A. H. Bousquet ◽  
Cedric Sueur ◽  
...  
Keyword(s):  
Decision Making ◽  
Drosophila Melanogaster ◽  
Social Network ◽  
Individual Decision ◽  
Social Network Structure ◽  
The Social ◽  
Survival And Reproduction ◽  
Crucial Information ◽  
Social Encounters ◽  
Selective Information

Animals use a number of different mechanisms to acquire crucial information. During social encounters, animals can pass information from one to another but, ideally, they would only use information that benefits survival and reproduction. Therefore, individuals need to be able to determine the value of the information they receive. One cue can come from the behaviour of other individuals that are already using the information. Using a previous extended dataset, we studied how individual decision-making is influenced by the behaviour of conspecifics in Drosophila melanogaster . We analysed how uninformed flies acquire and later use information about oviposition site choice they learn from informed flies. Our results suggest that uninformed flies adjust their future choices based on how coordinated the behaviours of the informed individuals they encounter are. Following social interaction, uninformed flies tended either to collectively follow the choice of the informed flies or to avoid it. Using social network analysis, we show that this selective information use seems to be based on the level of homogeneity of the social network. In particular, we found that the variance of individual centrality parameters among informed flies was lower in the case of a ‘follow’ outcome compared with the case of an ‘avoid’ outcome.

scholarly journals Impact of financial statements for financial decision-making

2020 ◽  
Vol 5 (2) ◽  
Author(s):  
Saddeq Abdulshakour
Keyword(s):  
Decision Making ◽  
Relative Weight ◽  
Financial Statements ◽  
Decision Makers ◽  
Financial Statement ◽  
Financial Decisions ◽  
Financial Decision Making ◽  
Vision 2030 ◽  
Study Population ◽  
Financial Decision

The study aimed to know the effects of analysis of financial statements on financial decisions, and the degree of benefit from them, and to identify what financial statements, what is its importance for the institutions within the framework of the Kingdom's Vision 2030 of ideas and trends, and to identify the contribution of financial statement analysis to financial decision-making. The study was based on the descriptive and analytical approach, and the study population consisted of all financial decision makers. The study was based on a simple random method (70) of financial decision makers. The study was based on the questionnaire and consisted of the following axes (financial statements in companies, financial decision-making, the effects of analysis of financial statements on financial decision-making). The study came out with a number of results, the most important of which are: There is approval by the respondents to all paragraphs of the first axis "financial statements in companies", with a relative weight of 82.8%. There is an agreement by the respondents on all paragraphs of the second axis "making financial decisions in companies", with a relative weight of 81.3%. There is strong approval by the respondents on all paragraphs of the third axis "the effects of analysis of financial statements on financial decision-making", with a relative weight of 86.4%. The financial statements are a key tool to know the financial position of the company, so they must be accurate and reliable before being published by management. The lack of credibility in the financial statements leads to mistrust in the company by investors, and does not give them the possibility to diagnose and make sound decisions. In light of the previous results, the study recommended the following: • Organizing several forums, conferences and forums to clarify the mechanism of preparing the financial statements and how to analyze them, and the need to raise awareness of financial decision makers about the importance of financial statements in the financial decision-making process.

scholarly journals Gender Differences in Financial Decisions

2018 ◽  
Vol 11 (1) ◽  
pp. 21-27
Author(s):  
Jeetendra Dangol
Keyword(s):  
Gender Differences ◽  
Decision Making ◽  
Financial Literacy ◽  
Sampling Technique ◽  
Financial Decisions ◽  
Financial Decision Making ◽  
Financial Decision ◽  
Convenience Sampling ◽  
Risk Taker ◽  
Survey Questionnaires

This paper examines the gender differences in financial decision-making of university students who are young, single, childless individuals that have at least average financial literacy and very small or no income. This paper is based on the survey questionnaires developed by Grable and Lytton (2003), distributed and collected from 100 students (50 men and 50 women) by using convenience sampling technique. The study finds that men and women differ in their financial decision. Women are less risk taker than men in financial decision-making; it indicates that women prefer to safer investment.

scholarly journals How Do Face Consciousness and Public Self-Consciousness Affect Consumer Decision-Making?

2020 ◽  
Vol 6 (4) ◽  
pp. 144
Author(s):  
Seung-Hee Lee ◽  
Jane Workman
Keyword(s):  
Decision Making ◽  
Univariate Analysis ◽  
Social Comparisons ◽  
Consumer Decision Making ◽  
Social Self ◽  
Consumer Decision ◽  
Fashion Leadership ◽  
The Social ◽  
Public Self Consciousness ◽  
Brand Prestige

Many individual differences affect consumers in the decision-making process (i.e., what to purchase; when to purchase). Face consciousness and public self-consciousness affect when in the fashion life cycle consumers decide to purchase, as well as what to purchase. Both face consciousness and public self-consciousness are concerned with consciousness (i.e., awareness; mindfulness) and both depend on social comparison processes. But the motivation underlying the social comparisons is different: with face consciousness, social comparisons yield appraisals of prestige and social status; with public self-consciousness, social comparisons yield assessments of situational appropriateness. The purpose of this study was to examine links among face consciousness; public self-consciousness; brand prestige; self-expressive brand (inner; social), and fashion leadership. Participants were 221 university students who completed a questionnaire. Descriptive statistics, Cronbach’s alpha reliability, and multivariate/univariate analysis of variance (M/ANOVA) were conducted to analyze data. Results showed that face consciousness and public self-consciousness similarly affected ratings of the social self-expressive brand. However, face consciousness (but not public self-consciousness) influenced ratings of brand prestige and inner self-expressive brand. Public self-consciousness (but not face consciousness) influenced fashion leadership. Thus, while face consciousness and public self-consciousness are both concerned with consciousness, they independently influence consumer decision-making in different ways. Theoretical and practical implications are provided.

scholarly journals FINANCIAL DECISION MAKING SELF-EFFICACY IN COGNITIVELY AND FINANCIALLY VULNERABLE OLDER ADULTS

2019 ◽  
Vol 3 (Supplement_1) ◽  
pp. S477-S478
Author(s):  
Evan Z Gross ◽  
Rebecca J Campbell ◽  
LaToya Hall ◽  
Peter Lichtenberg
Keyword(s):  
Alzheimer’S Disease ◽  
Older Adults ◽  
Alzheimer's Disease ◽  
Decision Making ◽  
Cognitive Impairment ◽  
Self Efficacy ◽  
Clinical Samples ◽  
Financial Decisions ◽  
Financial Decision Making ◽  
Financial Decision

Abstract Financial decision making self-efficacy (FDMSE) is a novel construct that may influence how older adults make financial decisions. Our previous research with a community sample of older adults demonstrated that cognitive functioning and suspected history of financial exploitation were both associated with low FDMSE. We sought to replicate these findings in two clinical samples of older adults: people with mild cognitive impairment (MCI) or probable Alzheimer’s disease (PAD) and current victims of scams or exploitation as determined by a financial coach. Samples were obtained from the Michigan Alzheimer’s Disease Center and a financial coaching intervention study. All participants completed a 4-item FDMSE measure. One-way ANOVAs, t-tests and chi-square tests were conducted to test for group differences with controls on demographics. There was a main effect of cognitive status on FDMSE, F(2,138) = 8.10, p &lt; .001, which was driven by higher FDMSE in the healthy group (N = 63) than the MCI (N = 76) or PAD (N = 28) groups. Similarly, scam victims (N = 25) had significantly lower FDMSE than non-exploited (N = 25) peers, t(48)=2.33, p &lt; 05. Cognitive impairment and current financial scams are both associated with low FDMSE levels. Low FDMSE may exacerbate cognitive and psychosocial vulnerabilities that contribute to risk for poor financial decisions among older adults. Future interventions to enhance FDMSE may help older adults make better decisions despite changes in thinking abilities or previous negative financial experiences.

Review of Family Financial Decision Making: Suggestions for Future Research and Implications for Financial Education

2017 ◽  
Vol 28 (2) ◽  
pp. 253-267 ◽  
Author(s):  
Jinhee Kim ◽  
Michael S. Gutter ◽  
Taylor Spangler
Keyword(s):  
Decision Making ◽  
Decision Process ◽  
Family System ◽  
Financial Education ◽  
Future Research ◽  
Financial Decisions ◽  
Individual Level ◽  
Financial Decision Making ◽  
Financial Decision ◽  
The Individual

This article reviews the theories and literature in intrahousehold financial decisions, spousal partners and financial decision making, family system and financial decision process, children, and financial decisions. The article draws conclusions from the literature review and discusses directions for future research and educational programs. Most financial education and counseling takes place at the individual level, whereas financial decisions take place at household and intrahousehold levels. Family members, spouses/partners, children, and others play a key role in individuals’ financial decisions. The article proposes the key programmatic implications for financial professionals and educators that need to be integrated into financial education and counseling. Understanding the unique dynamics of family financial decision making would help create effective educational and counseling strategies for the whole families.

scholarly journals The Problems of Budgeting and Financial Decision Process

Ekonomika ◽  
2004 ◽  
Vol 67 ◽  
Author(s):  
Jan Vávra
Keyword(s):  
Decision Making ◽  
Decision Process ◽  
Current Practice ◽  
Financial Decisions ◽  
Financial Decision Making ◽  
Advantages And Disadvantages ◽  
Annual Budget ◽  
Special Software ◽  
Financial Decision ◽  
Budgeting Process

Many companies recognize that the traditional annual budget (produced near yearend and then used as a guide for the following year even though it is out of date) is just not good enough. Instead, they are turning to alternative budgets (forecasts) that are updated every few months. They impose new requirements on financial decision-making. Management must access and process information more quickly, and this often means a change of the current practice of data collection and processing or even acquiring special software to do the job. The budgeting process and financial decisions can be accelerated and improved in several ways, and the paper deals with advantages and disadvantages of the possible ways.

scholarly journals PENGARUH KONDISI SOSIAL TERHADAP PERILAKU PENGAMBILAN KEPUTUSAN “PEREMPUAN” PEMILIK UMKM JAWA TIMUR UNTUK MENGADOPSI E-COMMERCE

2020 ◽  
Vol 4 (2) ◽  
pp. 94 ◽  
Author(s):  
Elya Kurniawati
Keyword(s):  
Decision Making ◽  
Small And Medium Enterprises ◽  
Social Conditions ◽  
Business People ◽  
The Social ◽  
Quantitative Descriptive ◽  
The Right ◽  
Medium Enterprises

Recent competition in the economy is dominated by companies that are able to implement the right technology into their business. E-commerce technology provides many conveniences for business people, including women as owners of Micro, Small, and Medium Enterprises (MSME) in East Java. Women are very potential and competent as actors and managers of Micro, Small, and Medium Enterprises (MSME). The purpose of this study is to determine the social conditions that influence the decision-making of these women as owners of Micro, Small, and Medium Enterprises (MSMEs) to adopt e-commerce. This study was conducted using quantitative descriptive methods. The sample consisted of 41 women as owners of MSME in East Java. Data were analyzed using percentages. The results of the study show that the majority of these MSME owners have understood e-commerce, but some of them have not adopted e-commerce as their competitive strategyDOI: http://dx.doi.org/10.17977/um021v4i22019p094

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