The Role of Impulses in Shaping Decisions

Judith Avrahami and Yaakov Kareev

Discussion Paper Series from The Federmann Center for the Study of Rationality, the Hebrew University, Jerusalem

Abstract: This article explores the extent to which decision behavior is shaped by short-lived reactions to the outcome of the most recent decision. We inspected repeated decision-making behavior in two versions of each of two decision-making tasks, an individual task and a strategic one. By regressing behavior onto the outcomes of recent decisions, we found that the upcoming decision was well predicted by the most recent outcome alone, with the tendency to repeat a previous action being affected both by its actual outcome and by the outcomes of actions not taken. Because the goodness of predictions based on the most recent outcome did not diminish as participants gained experience with the task, we conclude that repeated decisions are continuously affected by impulsive reactions.

Pages: 22 pages
Date: 2010-05
New Economics Papers: this item is included in nep-cbe, nep-exp, nep-hpe, nep-neu and nep-upt
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Citations: View citations in EconPapers (1)

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