Revisiting the Open Sampling format: Improving risky choices through a novel graphical representation

When making risky choices, people often fall short of the norm of expected value (EV) maximization. Previous research has shown that presenting options in the Open Sampling (OSa) format, a 10-by-10 matrix of randomly arranged outcomes, can improve choices and reduce decision times. First, the current research aims to replicate and extend the findings on the OSa format. To this end, we compare OSa to the common description-based format as well as further graphical representations, and investigate the resulting accordance with EV maximization and decision time. Second, we study whether people lower (vs. higher) in numeracy, the ability to use probabilistic and mathematical concepts, particularly benefit from a graphical representation of options. We conducted five high-powered studies (total N = 1,575) in which participants chose repeatedly between two risky gambles, using different populations and gamble-problem sets. Overall, we could not find a benefit of the OSa format in terms of EV accordance in any of the five studies. However, three studies also tested a novel variant of the OSa format with grouped outcomes and found that it consistently improved EV accordance compared with all other formats. All graphical formats led to faster decisions without harming decision quality. The effects of presentation format were not moderated by numeracy in three of the four studies that assessed numeracy. In conclusion, our research introduces a new presentation format which consistently improves risky choices and can also be used to communicate risks in applied contexts such as medical decision making.

The effect of learning condition on memory for and integration of related information

Although we often are tasked with learning pieces of information that are related in some way in educational settings, the learning conditions that promote learning of and connections across related information are still poorly understood. In this thesis, I asked: Which instruction methods promote learning of and connections across (integration of) related information? In the two experiments in this thesis, participants were presented related information in two different formats, and we assessed their memory for related information, in addition to how well they could integrate related information to derive new knowledge. The two presentation formats incorporated the same number of exposures of related information, but the sequence with which information was presented was manipulated: In one presentation format (blocked) participants strongly learn one set of information, before being confronted with a related set of information, whereas participants learn related information in parallel in the other (interleaved). In Experiment 1, we found that blocked presentation enhanced both memory for and integration of related information. However, given potential effects of testing order on our results, we more closely examined memory for related information in Experiment 2. In Experiment 2, we no longer found a difference in overall memory for related information between the two presentation formats. In fact, we found evidence that presence of shared information enhanced learning of related information after interleaved presentation only. Regardless, the results of both experiments demonstrated that manipulating just the sequence with which information is presented, without increasing the number of exposures, can enhance learning, an impactful finding in an era of increased pressures to maximize instructional time.

The effect of learning condition on memory for and integration of related information

Although we often are tasked with learning pieces of information that are related in some way in educational settings, the learning conditions that promote learning of and connections across related information are still poorly understood. In this thesis, I asked: Which instruction methods promote learning of and connections across (integration of) related information? In the two experiments in this thesis, participants were presented related information in two different formats, and we assessed their memory for related information, in addition to how well they could integrate related information to derive new knowledge. The two presentation formats incorporated the same number of exposures of related information, but the sequence with which information was presented was manipulated: In one presentation format (blocked) participants strongly learn one set of information, before being confronted with a related set of information, whereas participants learn related information in parallel in the other (interleaved). In Experiment 1, we found that blocked presentation enhanced both memory for and integration of related information. However, given potential effects of testing order on our results, we more closely examined memory for related information in Experiment 2. In Experiment 2, we no longer found a difference in overall memory for related information between the two presentation formats. In fact, we found evidence that presence of shared information enhanced learning of related information after interleaved presentation only. Regardless, the results of both experiments demonstrated that manipulating just the sequence with which information is presented, without increasing the number of exposures, can enhance learning, an impactful finding in an era of increased pressures to maximize instructional time.

The Joint Effect of Presentation Format and Disclosure Balance on Investors’ Reactions to Sensitivity Disclosures of Hedging Instruments

Derivative-related risk disclosure has been a key issue in accounting regulation and research, and sensitivity analysis is the most popular form of quantitative derivative-related disclosure. In an experiment, we find that, relative to disclosing potential losses only, disclosing both potential gains and potential losses associated with hedged items and derivatives leads to favorable investor reactions when information about net risk after hedging is omitted from the disclosure, but not when net risk is shown. We further show that disclosing net risk in addition to hedged-item and derivative risks is as effective at lowering investors’ risk perceptions as disclosing potential gains. Finally, we demonstrate that disclosing net risk and disclosing potential gains affect investors’ judgments through different mechanisms. Our results have important implications for investors, managers, and regulators.

Market reactions to the internal control reporting presentation format: combined vs separate audit reports

PurposeThis paper aims to investigate whether the stock market reacts to presentation options available to auditors under AS 2 (providing separate financial statement audit and internal control over financial reporting [ICOFR] audit reports, or presenting a combined report with both audit opinions). Design/methodology/approachDrawing on psychology theory, the authors hypothesize that presenting material weaknesses in ICOFR with an unqualified financial statement audit in a combined report effectively dilutes the weight placed on the material weaknesses perceived by investors. The authors further hypothesize the presentation format effect to vary by type of material weaknesses since some material weaknesses are considered more serious than others. The authors examine ICOFR and audit reporting and cumulative abnormal return data from 2007 to 2017 using two-stage least squares regression analysis. FindingsThe results show that a combined report of ineffective ICOFR and unqualified financial statement audit reduces the negative impact of material weakness disclosures on stock price reactions, but only when the weaknesses involve more serious entity-wide controls, as opposed to controls over specific accounts. Practical implicationsThe findings help inform preparers, auditors, regulators and investors about the potentially unintended consequences of reporting format choice. Originality/valueThe findings contribute to the literature on internal control disclosures by demonstrating that market reactions to these disclosures depend not only on the types of material weaknesses disclosed but also on their presentation format.

Framing effects of information on investment risk perception

ABSTRACT The aim of this study is to verify whether the framing effects of past performance information affect the risk perception of individuals for fixed-income and variable income fund. We assess whether risk perception varies depending on how information is communicated to investors, considering the relevance of possible framing effects arising from how information is presented in investment funds’ prospectuses and reports. This study is aimed at investors (individual and institutional) and fund industry regulators, highlighting the importance of past performance presentation. This article aims to contribute to the area by investigating how investors are influenced by varying perceptions of risk and return on fixed-income and variable-income assets, depending on information presentation format. The approach used is based on a 2x2 factorial quasi-experiment, in which format (within-subject) and time horizon (between-subjects) effects are tested in a sample of 143 respondents. Our results indicate that, for investment in a variable-income fund, a monthly yield presentation format leads to higher perceived risk, and that a framing emphasizing fund value evolution leads to higher perceived returns. As for investment in a fixed-income fund, the framing that emphasizes fund value leads to both higher perceived risk and higher perceived returns. When comparing the results for the two types of investments, the risk perception was higher for variable-income than for fixed income funds. However, perceived returns were higher for fixed income than for variable-income funds due to the framing effect, although realized returns do not corroborate this perception.

Tipologi Gaya Video Instruksional di Universitas Terbuka TV

This article explains the typology of instructional video styles in Universitas Terbuka TV (UT TV) as a learning medium in open and distance higher education. Instructional video styles are an essential aspect of learning media because they relate to student involvement in the learning process. This research used a descriptive content analysis method to obtain and determine the style of communication in each video studied. The result indicates that the instructional video style on UT TV tends to be consistent across subjects and disciplines. The style used by most instructional videos on UT TV is slide style, both as the main style and as a secondary style. The slide style is identical to the presentation format in conventional lectures, where slides are positioned as teaching aids so learning material can easily be understood. Artikel ini berusaha memaparkan tipologi gaya video instruksional di Universitas Terbuka TV (UT TV) sebagai media pembelajaran di Pendidikan Tinggi Terbuka dan Jarak Jauh (PTTJJ). Gaya video instruksional merupakan aspek penting dalam media pembelajaran sebab berkaitan dengan tingkat keterlibatan mahasiswa dalam proses pembelajaran. Penelitian ini menggunakan metode analisis isi deskriptif untuk mengidentifikasi gaya komunikasi pada setiap video yang diteliti. Hasil penelitian ini menunjukkan bahwa video instruksional di UT TV memiliki gaya komunikasi yang cenderung seragam di seluruh mata pelajaran dan disiplin ilmu. Gaya yang digunakan di sebagian besar video instruksional di UT TV adalah gaya slide, baik sebagai gaya utama maupun gaya pendukung. Gaya slide sangat identik dengan format presentasi pada perkuliahan konvensional, di mana slide diposisikan sebagai alat bantu pengajar saat menyampaikan materi agar mudah dipahami oleh mahasiswa.