The Effects of Immediate Context on Auditors' Judgments of Loan Quality

2004 ◽  
Vol 23 (1) ◽  
pp. 89-105 ◽  
Author(s):  
Dennis M. O'Reilly ◽  
Robert A. Leitch ◽  
Douglas H. Wedell
Keyword(s):  
Contrast Effect ◽  
Frequency Theory ◽  
Accounting Students ◽  
Assimilation Effect ◽  
Judgment Bias ◽  
Judgment Biases ◽  
Commercial Loans ◽  
Loan Quality ◽  
Task Experience

This study examines whether auditors, when making a series of similar, independent judgments are non-normatively influenced by their earlier judgments. Two judgment biases are considered: contrast effect and assimilation effect. We conducted an experiment where experienced auditors classified a number of commercial loans based on collection risk. The auditors' judgments displayed a significant contrast effect, and range-frequency theory explains a significant portion of the variance in their judgments (Parducci 1965). The results suggest that auditors tended to use the range principle more than the frequency principle to classify loans. This bias has potential implications for audit practice. By comparing auditors to graduate accounting students we find evidence that task experience moderates the magnitude of the judgment bias.

Reference Groups as Anchors in Judgments of other Groups: A Biasing Factor in “Rating Tasks”?

1980 ◽  
Vol 47 (3) ◽  
pp. 967-975 ◽  
Author(s):  
Robert L. Montgomery
Keyword(s):  
Contrast Effect ◽  
Reference Group ◽  
Social Judgment ◽  
Contrast Effects ◽  
Reference Groups ◽  
Assimilation Effect ◽  
Social Judgment Theory ◽  
Male Undergraduate ◽  
Campus Organizations ◽  
The Prestige

A phenomenon which might bias rating tasks (the reference group as an anchor phenomenon) was explored by having 144 male undergraduate members of Greek, eating club, and independent organizations, and students belonging to none of these organizations rank 28 campus organizations in terms of relative prestige. In general, members of groups consistently overestimated the prestige of their own (assimilation effect), under-estimated the prestige of organizations dissimilar to their own (contrast effect), and had more pronounced assimilation and contrast effects than did subjects not belonging to the rated organizations. Moreover, members of groups placed a greater number of organizations dissimilar to their own into objectionable categories. These results suggest that it might be extremely difficult for highly ego-involved persons to maintain an appropriate judgmental set in such tasks when the ratings are made on the basis of the quality, prestige, and other such ill-defined criteria. Over-all, the results strongly supported predictions made from social judgment theory.

Self-control today, indulgence tomorrow? How judgment bias and temporal distance influence self-control decisions

2018 ◽  
Vol 35 (5) ◽  
pp. 480-490
Author(s):  
Wagner Junior Ladeira ◽  
Fernando Oliveira Santini ◽  
Diego Costa Pinto ◽  
Clécio Falcao Araujo ◽  
Fernando A. Fleury
Keyword(s):  
Perceived Control ◽  
Self Control ◽  
Temporal Distance ◽  
Content Type ◽  
Judgment Bias ◽  
Mediating Role ◽  
Judgment Biases ◽  
Research Findings ◽  
Short And Long Term

Purpose This paper aims to analyze how judgment bias (optimism vs pessimism) and temporal distance influence self-control decisions. This research also analyzes the mediating role of perceived control on judgment bias and temporal distance. Design/methodology/approach Three studies (one laboratory and two online experiments) analyze how judgment bias and temporal distance influence self-control decisions on consumers’ willingness to pay. Findings The findings uncover an important boundary condition of temporal distance on self-control decisions. In contrast to previous research, the findings indicate that individuals exposed to optimism (vs pessimism) bias display more self-control in the future and make choices that are more indulgent in the present. The findings also reveal that perceived control mediates the effects of judgment bias and temporal distance. Practical implications The findings help managers to adapt short- and long-term marketing efforts, based on consumers’ momentary judgment biases and on their chronic judgment bias orientation. Originality/value This research contributes to the literature on self-control and temporal distance, showing that judgment bias reverses previous research findings on self-control decisions.

Reaction to a Communication as a Function of Attitude-Communication Discrepancy

1966 ◽  
Vol 18 (3) ◽  
pp. 767-774 ◽  
Author(s):  
Lutfy N. Diab
Keyword(s):  
Contrast Effect ◽  
Assimilation Effect ◽  
American University ◽  
American University Of Beirut ◽  
Arab Students

235 undergraduate Arab students at the American University of Beirut were administered a questionnaire through which Ss' latitudes of acceptance and rejection towards Arab unity were assessed. Then, Ss' reactions to a moderately anti-Arab unity “communication” were obtained. The results showed that, as the discrepancy between Ss' own stands and the position advocated increased, “contrast effect” occurred. However, little evidence for an “assimilation effect” was found. Consideration of Ss' latitudes of acceptance and rejection, rather than the “most acceptable” position alone, was shown to account much more meaningfully for the results.

scholarly journals Weather Warning Uncertainty: High Severity Influences Judgment Bias

2017 ◽  
Vol 9 (3) ◽  
pp. 441-454 ◽  
Author(s):  
Joy E. Losee ◽  
Karen Z. Naufel ◽  
Lawrence Locker ◽  
Gregory D. Webster
Keyword(s):  
Contrast Effect ◽  
Similar Pattern ◽  
Message Content ◽  
Judgment Bias ◽  
High Severity ◽  
Severe Event ◽  
Made In

Abstract Information about hurricanes changes as the storm approaches land. Additionally, people tend to think that severe events are more likely to occur even if the probability of that event occurring is the same as a less severe event. Thus, holding probability constant, this research tested the influence of severity on storm judgments in the context of updates about the approaching storm’s severity. In two studies, participants watched one of four (experiment 1) or one of five (experiment 2) sequences of updating hurricane warnings. The position of category 1 and category 5 hurricane warnings in the sequences varied (e.g., category 1 first and category 5 last, or category 5 first and category 1 last). After the videos, participants made judgments about the approaching storm. In experiment 1, participants generally overestimated the threat of the storm if they saw a category 5 hurricane warning in any position. Experiment 2, designed to test whether experiment 1 results were due to a contrast effect, revealed a similar pattern to experiment 1. Overall, when participants saw a category 5 hurricane warning, they anchored to severity regardless of updates that the storm had decreased in severity. Importantly, however, the extent of anchoring to severity depended on the type of judgment participants made. In terms of policy, the study proposes that weather warning agencies focus on message content at least as much as they focus on message accuracy.

Witnessing Your Own Cognitive Bias: A Compendium of Classroom Exercises

2014 ◽  
Vol 30 (1) ◽  
pp. 13-34 ◽  
Author(s):  
Rebecca G. Fay ◽  
Norma R. Montague
Keyword(s):  
Cognitive Bias ◽  
Accounting Students ◽  
Board Members ◽  
Professional Judgment ◽  
Student Interest ◽  
High Quality ◽  
Accounting Professionals ◽  
Judgment Biases ◽  
Psychology Literature ◽  
Corporate Level

ABSTRACT Accounting and auditing professors continually stress the importance of effective judgment and decision making (JDM), yet few accounting programs or textbooks discuss the biases that may impact an individual's ability to exercise high-quality professional judgment. In recent years, KPMG (Ranzilla, Chevalier, Herrmann, Glover, and Prawitt 2011) and the Committee of Sponsoring Organizations of the Treadway Commission (KPMG, Glover, and Prawitt 2012) addressed this gap at the corporate level by publishing guidance for accounting professionals and board members on how to identify and mitigate common judgment biases, yet there remain few resources designed for accounting students. This collection of exercises enables instructors to introduce the topic of effective JDM in the classroom. It provides students with the opportunity to identify bias in their own judgments by highlighting five frequently occurring biases that adversely impact business judgments (i.e., availability, anchoring, overconfidence, confirmation, and rush to solve). This compendium gathers exercises from psychology literature that may be used to pique student interest and encourage discussion of how each bias impacts judgments made by accounting professionals and how individuals may reduce their impact.

scholarly journals Cancer blues? A validated judgment bias task suggests pessimism in nude mice with tumors

2021 ◽  
Author(s):  
A. Resasco ◽  
A. MacLellan ◽  
M. A. Ayala ◽  
L. Kitchenham ◽  
A. M. Edwards ◽  
...  
Keyword(s):  
Nude Mice ◽  
Construct Validation ◽  
Affective State ◽  
Affective States ◽  
Laboratory Mice ◽  
Ambiguous Information ◽  
Judgment Bias ◽  
Tumor Bearing ◽  
Judgment Biases ◽  
Lung Adenocarcinomas

AbstractIn humans, affective states can bias responses to ambiguous information: a phenomenon termed judgment bias (JB). Judgment biases have great potential for assessing affective states in animals, in both animal welfare and biomedical research. New animal JB tasks require construct validation, but for laboratory mice (Mus musculus), the most common research vertebrate, a valid JB task has proved elusive. Here (Experiment 1), we demonstrate construct validity for a novel mouse JB test: an olfactory Go/Go task in which subjects dig for high- or low-value food rewards. In C57BL/6 and Balb/c mice faced with ambiguous cues, latencies to dig were sensitive to high/low welfare housing, environmentally-enriched animals responding with relative ‘optimism’ through shorter latencies. Illustrating the versatility of a validated JB task across fields of research, it further allowed us to test hypotheses about the mood-altering effects of cancer (Experiment 2). Male nude mice bearing subcutaneous lung adenocarcinomas responded more pessimistically than healthy controls to ambiguous cues. Similar effects were not seen in females, however. To our knowledge, this is the first validation of a mouse JB task and the first demonstration of pessimism in tumor-bearing animals. This task, especially if refined to improve its sensitivity, thus has great potential for investigating mouse welfare, the links between affective state and disease, depression-like states in animals, and hypotheses regarding the neurobiological mechanisms that underlie affect-mediated biases in judgment.

scholarly journals The Judgment Bias Task: A flexible method for assessing individual differences in social judgment biases

2016 ◽  
Author(s):  
Jordan Axt ◽  
Helen Nguyen ◽  
Brian A. Nosek
Keyword(s):  
Individual Differences ◽  
Social Information ◽  
Social Judgment ◽  
Psychological Research ◽  
Social Psychological ◽  
Judgment Bias ◽  
Judgment Biases ◽  
Social Psychological Research ◽  
Single Response ◽  
Social Biases

Many areas of social psychological research investigate how social information may bias judgment. However, most measures of social judgment biases are [1] low in reliability because they use a single response, [2] not indicative of individual differences in bias because they use between-subjects designs, [3] inflexible because they are designed for a particular domain, and [4] ambiguous about magnitude of bias because there is no objectively correct answer. We developed a measure of social judgment bias, the Judgment Bias Task, in which participants judge profiles varying in quality for a certain outcome based on objective criteria. The presence of ostensibly irrelevant social information provides opportunity to assess the extent to which social biases undermine the use of objective criteria in judgment. The JBT facilitates measurement of social judgment biases by [1] using multiple responses, [2] indicating individual differences by using within-subject designs, [3] being adaptable for assessing a variety of judgments, [4] identifying an objective magnitude of bias, and [5] taking six minutes to complete on average. In nine pre-registered studies (N> 9,000) we use the JBT to reveal two prominent social judgment biases: favoritism towards more physically attractive people and towards members of one’s ingroup. We observe that the JBT can reveal social biases, and that these sometimes occur even when the participant did not intend or believe they showed biased judgment. A flexible, objective, efficient assessment of social judgment biases will accelerate theoretical and empirical progress.

The Effect of Direction, Self-Relevance, and Focus of Social Comparisons on Self-Evaluation: Interpretation via Assimilation and Contrast Effects

2010 ◽  
Vol 106 (2) ◽  
pp. 359-373 ◽  
Author(s):  
Chia-Ching Tsai
Keyword(s):  
Contrast Effect ◽  
Social Comparisons ◽  
Contrast Effects ◽  
Assimilation Effect ◽  
Self Evaluation ◽  
Comparison Direction

This study investigated the effect of direction, self-relevance, and focus of social comparisons on self-evaluation. 160 participants (76 men, 84 women; 19–27 years old) were enrolled from a marketing class. Using self as the focus of comparison will cause a contrast effect, while using others as the focus of comparison will have an assimilation effect. When the comparison dimension is highly self-relevant, a contrast effect will be observed on self-evaluation, while an assimilation effect will be observed when the comparison dimension is low on self-relevance. Also, when self is the focus of comparison, a highly self-relevant comparison dimension will make the contrast effect stronger, while a dimension with low self-relevance will make the contrast effect weaker. Conversely, when others are the focus of comparison, a comparison dimension that has low self-relevance will make the assimilation effect stronger, while a highly self-relevant one will weaken it. Primary results in this study were an interaction of comparison direction by focus of comparison and an interaction of comparison direction by self-relevance on self-evaluation.

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