How expectations affect reference point formation: an experimental investigation

Hack, Andreas; von Bieberstein, Frauke (2015). How expectations affect reference point formation: an experimental investigation. Review of Managerial Science, 9(1), pp. 33-59. Springer 10.1007/s11846-014-0121-0

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This paper addresses two major topics concerning the role of expectations in the formation of reference points. First, we show that when expectations are present, they have a significant impact on reference point formation. Second, we find that decision-makers employ expected values when forming reference points (integrated mechanism) as opposed to single possible outcomes (segregated mechanism). Despite the importance of reference points in prospect theory, to date, there is no standard method of examining these. We develop a new experimental design that employs an indirect approach and extends an existing direct approach. Our findings are consistent across the two approaches.

Item Type:

Journal Article (Original Article)

Division/Institute:

03 Faculty of Business, Economics and Social Sciences > Department of Business Management > Institute of Organization and Human Resource Management > Organisation
03 Faculty of Business, Economics and Social Sciences > Department of Business Management > Institute of Organization and Human Resource Management > Human Resource Management

UniBE Contributor:

Hack, Andreas and von Bieberstein, Frauke

Subjects:

600 Technology > 650 Management & public relations
300 Social sciences, sociology & anthropology > 330 Economics

ISSN:

1863-6683

Publisher:

Springer

Language:

English

Submitter:

Frauke von Bieberstein

Date Deposited:

26 May 2015 08:43

Last Modified:

26 May 2015 08:43

Publisher DOI:

10.1007/s11846-014-0121-0

BORIS DOI:

10.7892/boris.68838

URI:

https://boris.unibe.ch/id/eprint/68838

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