Have a personal or library account? Click to login
Anchoring and Overconfidence: The Influence of Culture and Cognitive Abilities Cover

Anchoring and Overconfidence: The Influence of Culture and Cognitive Abilities

Open Access
|Sep 2017

References

  1. Acker, D., Duck, N. W. (2008), Cross-cultural overconfidence and biased self-attribution, The Journal of Socio-Economics, No. 37, pp. 1815–1824
  2. Aggarwal, R., Goodell, J. W. (2014), National cultural dimensions in finance and accounting scholarship: an important gap in the literatures? Journal of Behavioral and Experimental Finance, No. 1, pp. 1–12.
  3. Antonczyk, R. C., Salzmann, A. J. (2014), Overconfidence and optimism: the effect of national culture on capital structure, Research in International Business and Finance, No. 31, pp. 32–151.
  4. Ariely, D., Loewenstein, G., Prelec, D. (2003), Coherent arbitrariness: stable demand curves without stable preferences, The Quarterly Journal of Economics, No. 118, pp. 73–105.10.1162/00335530360535153
  5. Barber, B. M., Odean, T. (2001), Boys will be boys: gender, overconfidence, and common stock investment, Quarterly Journal of Economics, No. 116 (1), pp. 261–292.
  6. Bergman, O., Ellingsen, T., Johannesson, M., Svensson, C. (2010), Anchoring and cognitive ability, Economics Letters, No. 107 (1), pp. 66–68.
  7. Breuer, W., Quinten, B. (2009), Cultural finance, SSRN eLibrary, available at: http://dx.doi.org/10.2139/ssrn.1282068 (20.01.2015).10.2139/ssrn.1282068(20.01.2015)
  8. Camerer, C., Lovallo, D. (1999), Overconfidence and excess entry: an experimental approach, The American Economic Review, No. 89 (1), pp. 306–318.
  9. Campitelli, G., Gerrans, P. (2013), Does the cognitive reflection test measure cognitive reflection? A mathematical modeling approach, Memory and Cognition, No. 42 (3), pp. 434–447.10.3758/s13421-013-0367-9
  10. Cervone, D., Peake, P. K. (1986), Anchoring, efficacy, and action: the influence of judgmental heuristics on self-efficacy judgments and behavior, Journal of Personality and Social Psychology, No. 50, pp. 492–501.10.1037/0022-3514.50.3.492
  11. Chapman, G. B., Johnson, E. J. (1999), Anchoring, activation, and the construction of values, Organizational Behavior and Human Decision Processes, No. 79, pp. 1–39.
  12. Cheek, N. N., Norem, K. (2016), Holistic thinkers anchor less: exploring the roles of self-construal and thinking styles in anchoring susceptibility, Personality and Individual Differences, available at: http://www.sciencedirect.com/science/article/pii/S0191886916300356 (14.04.2016).
  13. Choi, I., Koo, M., Choi, J. A. (2007), Individual differences in analytic versus holistic thinking, Personality and Social Psychology Bulletin, No. 33, pp. 691–705.10.1177/0146167206298568
  14. Chui, A., Titman, S., Wei, K. (2010), Individualism and momentum around the world, Journal of Finance, No. 65 (1), pp. 361–392.
  15. Critcher, C. R., Gilovich, T. (2008), Incidental environmental anchors, Journal of Behavioral Decision Making, No. 21, pp. 241–251.10.1002/bdm.586
  16. Czerwonka, M. (2014), The influence of religion on socially responsible investing, Journal of Religion and Business Ethics, No. 3 (1), p. 21.
  17. Daniel, K. D., Hirshleifer, D., Subrahmanyam, A. (2001), Overconfidence, arbitrage, and equilibrium asset pricing, The Journal of Finance, No. 56 (3), pp. 921–965.10.1111/0022-1082.00350
  18. Duttle, K., Inukai, K. (2015), Complexity aversion: influences of cognitive abilities, culture and system of thought, Economic Bulletin, No. 35 (2), pp. 846–855.
  19. Englich, B., Mussweiler, T. (2001), Sentencing under uncertainty: anchoring effects in the courtroom, Journal of Applied Social Psychology, No. 31, pp. 1535–1551.10.1111/j.1559-1816.2001.tb02687.x
  20. Englich, B., Mussweiler, T., Strack, F. (2006), Playing dice with criminal sentences: the influence of irrelevant anchors on experts’ judicial decision making, Personality and Social Psychology Bulletin, No. 32, pp. 188–200.10.1177/0146167205282152
  21. Epley, N., Gilovich, T. (2001), Putting adjustment back into the anchoring and adjustment heuristic: differential processing of self-generated and experimenter-provided anchors, Psychological Science, No. 12, pp. 391–396.10.1111/1467-9280.00372
  22. Epley, N., Gilovich, T. (2005), When effortful thinking influences judgmental anchoring: differential effects of forewarning and incentives on self-generated and externally provided anchors, Journal of Behavioral Decision Making, No. 18, pp. 199–212.10.1002/bdm.495
  23. Frederick, S. (2005), Cognitive reflection and decision making, Journal of Economics Perspectives, No. 19 (4), pp. 25–42.
  24. Frijns, B., Gilbert, A., Lehnert, T., Tourani-Rad, A. (2013), Uncertainty avoidance, risk tolerance and corporate takeover decisions, Journal of Banking and Finance, No. 37 (7), pp. 2457–2471.
  25. Furnham, A., Boo, H. Ch., (2011), A literature review of the anchoring effect, The Journal of Socio-Economics, No. 40, pp. 35–42.
  26. Galinsky, A. D., Mussweiler, T. (2001), First offers as anchors: the role of perspective-taking and negotiator focus, Journal of Personality and Social Psychology, No. 81, pp. 657–669.10.1037/0022-3514.81.4.657
  27. Gigerenzer, G. (1996), On narrow norms and vague heuristics: a reply to Kahneman and Tversky (1996), Psychological Review, No. 103 (3), pp. 592–596.
  28. Guiso, L., Sapienza, P., Zingales, L. (2006), Does culture affect economic outcomes? Journal of Economic Perspectives, No. 20, pp. 23–48.10.1257/jep.20.2.23
  29. Hackbarth, D. (2008), Managerial traits and capital structure decisions, Journal of Financial and Quantitative Analysis, No. 43, pp. 843–882.10.1017/S002210900001437X
  30. Heaton, J. B. (2002), Managerial optimism and corporate finance, Financial Management, No. 31, pp. 33–45.10.2307/3666221
  31. Hofstede, G., Hofstede, G. J., Minkov, M. (2010), Cultures and organizations: software of the mind, 3rd Edition, McGraw-Hill Education, New York.
  32. Hoppe, E. I., Kusterer, D. J. (2011), Behavioral biases and cognitive reflection, Economics Letters, No. 110 (2), pp. 97–100.
  33. Jacowitz, K. E., Kahneman, D. (1995), Measures of anchoring in estimation tasks, Personality and Social Psychology Bulletin, No. 21, pp. 1161–1166.10.1177/01461672952111004
  34. Jlassi, M., Naoui, K., Mansour, W. (2014), Overconfidence behavior and dynamic market volatility: evidence from international data, Procedia Economics and Finance, No. 13, pp. 128–142.
  35. Kahneman, D. (2011), Thinking fast and slow, Farrar, Straus and Giroux, New York.
  36. Kahneman, D., Tversky, A. (1996), On the reality of cognitive illusions, Psychological Review, No. 103 (3), pp. 582–591.
  37. Kahneman, D., Tversky, A. (1977), Intuitive prediction: biases and corrective procedures, available at: http://www.dtic.mil/dtic/tr/fulltext/u²/a047747.pdf (12.09.2015).
  38. Kahneman, D., Tversky, A. (1979), Prospect theory: an analysis of decisions under risk, Econometrica, No. 47 (2), pp. 263–292.10.2307/1914185
  39. Kahneman, D., Tversky, A. (1984), Choices, values and frames, American Psychologist, No. 39 (4), pp. 341–350.10.1037/0003-066X.39.4.341
  40. Klayman, J., Soll, J. B., Gonzalez-Vallejo, C., Barlas, S. (1999), Overconfidence: it depends on how, what, and whom you ask, Organizational Behavior and Human Decision Processes, No. 79 (3), pp. 216–247.10.1006/obhd.1999.2847
  41. Kwok, C., Tadesse, S. (2006), National culture and financial systems, Journal of International Business Studies, No. 37 (2), pp. 227–247.10.1057/palgrave.jibs.8400188
  42. Larrick, R. P., Burson, K. A., Soll, J. B. (2007), Social comparison and confidence: when thinking you’re better than average predicts overconfidence (and when it does not), Organizational Behaviour and Human Decision Processes, No. 102 (1), pp. 76–94.
  43. Levinson, J. D., Peng, K. (2007), Valuing cultural differences in behavioral economics, The ICFAI Journal of Behavioral Finance, No. 4 (1), pp. 32–47.
  44. Malmendier, U., Tate, G. (2005), CEO overconfidence and corporate investment, The Journal of Finance, No. 60 (6), pp. 2661–2700.10.1111/j.1540-6261.2005.00813.x
  45. Markus, H. R., Kitayama, S. (1991), Culture and the self: implications for cognition, emotion, and motivation, Psychological Review, No. 98, pp. 224–253.
  46. Moore, D. A., Healy, P. J. (2008), The trouble with overconfidence, Psychological Review, No. 115 (2), p. 502.
  47. Nisbett, R. E., Peng, K., Choi, I., Norenzayan, A. (2001), Culture and systems of thought: holistic versus analytic cognition, Psychological Review, No. 108, pp. 291–310.
  48. Nisbett, R. E., Masuda T. (2003), Culture and point of view, Proceedings of the National Academy of Sciences of the United States of America, No. 100 (19), pp. 11163–11170.10.1073/pnas.1934527100
  49. Oechssler, J., Roider, A., Schmitz, P. W. (2009), Cognitive abilities and behavioural biases, Journal of Economic Behavior & Organization, No. 72 (1), pp. 147–152.
  50. Oskamp, S. (1965), Overconfidence in case-study judgments, Journal of consulting psychology, No. 29 (3), pp. 261–265.
  51. Pennycook, G., Cheyne, J. A., Koehler, D. J., Fugelsang, J. A. (2016), Is the cognitive reflection test a measure of both reflection and intuition? Behav Res Methods, No. 48 (1), pp. 341–348.10.3758/s13428-015-0576-1
  52. Rzeszutek, M. (2015), Personality traits and susceptibility to behavioral biases among a sample of Polish stock market investors, International Journal of Management and Economics, No. 47 (1), pp. 71–81.
  53. Scheinkman, J. A., Xiong, W. (2003), Overconfidence and Speculative Bubbles, Journal of Political Economy, No. 111 (6), pp. 1183–1220.
  54. Siegel, J. I., Licht, A. N., Schwartz, S. H. (2011), Egalitarianism and international investment, Journal of Financial Economics, No. 102 (3), pp. 621–642.10.1016/j.jfineco.2011.05.010
  55. Soll, J. B., Klayman J., (2004), Overconfidence in interval estimates, Journal of Experimental Psychology. Learning, Memory and Cognition, No. 30 (2), pp. 299–314.10.1037/0278-7393.30.2.299
  56. Stewart, N. (2009), The cost of anchoring on credit-card minimum repayments, Psychological Science, No. 20, pp. 39–41.10.1111/j.1467-9280.2008.02255.x
  57. Toplak, M. E., West, R. F., Stanovich, K. E. (2011), The cognitive reflection test as a predictor of performance on heuristics and biases tasks, Memory & Cognition, No. 39, pp. 1275–1289.
  58. Toplak, M. E., West, R. F., Stanovich, K. E. (2014), Assessing miserly information processing: an expansion of the cognitive reflection test, Thinking and Reasoning, No. 20, pp. 147–168.
  59. Tversky, A., Kahneman, D. (1974), Judgment under uncertainty: heuristics and biases, Science. New Series, No. 185 (4157), pp. 1124–1131.
  60. Wang, M., Fischbeck, P. S. (2004), Similar in how to frame, but different in what to choose, Marketing Bulletin, No. 15, pp. 1–12.
  61. Yates, J. F., Lee, J.-W. (1996), Chinese decision making, in: M. H. Bond (Ed.), Handbook of chinese psychology, Oxford University Press, Hong Kong, pp. 338–351.
  62. Yates, J. F., Lee, J.-W., Shinotsuka, H. (1996), Beliefs about overconfidence, including its cross-national variation, Organizational Behavior and Human Decision Processes, No. 65, pp. 138–147.10.1006/obhd.1996.0012
  63. Yates, J. F., Lee, J.-W., Bush, J. G. (1997), General knowledge overconfidence: cross-national variations, response style and ‘reality’, Organizational Behavior and Human Decision Processes, No. 70, pp. 87–94.10.1006/obhd.1997.2696
  64. Zheng, X., El Ghoul, S., Guedhami, O., Kwok, C. C. Y. (2012), National culture and corporate debt maturity, Journal of Banking and Finance, No. 36 (2), pp. 468–488.
  65. Zingales, L. (2015), The “cultural revolution” in finance, Journal of Financial Economics, No. 117, pp. 1–4.
DOI: https://doi.org/10.1515/ijme-2017-0018 | Journal eISSN: 2543-5361 | Journal ISSN: 2299-9701
Language: English
Page range: 48 - 66
Published on: Sep 29, 2017
Published by: Warsaw School of Economics
In partnership with: Paradigm Publishing Services
Publication frequency: 4 issues per year

© 2017 Monika Czerwonka, published by Warsaw School of Economics
This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.