Cross cultural differences in decisions from experience: Evidence from Denmark, Israel, and Taiwan

Sibilla Di Guida, Ido Erev and Davide Marchiori

Journal of Economic Psychology, 2015, vol. 49, issue C, 47-58

Abstract: Three studies are presented that compare decisions from experience in Denmark, Israel, and Taiwan. They focus on two change-related cultural differences suggested by previous research on dialectical vs. analytic approach to thinking. The first implies that East Asians are more likely to change their behavior over time (i.e., are less consistent), the second that they expect more changes in the environment. The results show that the “less consistency in the East” hypothesis has a high predictive value. This hypothesis accurately predicts a behavioral pattern that was documented in all three studies, as well as a non-trivial effect of limited feedback in Study 3: When feedback was limited to the obtained payoff, the participants from Taiwan exhibited less risk aversion than the Israeli. Analysis of the “expecting more changes in the East” hypothesis reveals mixed results. This hypothesis was supported in Study 2, which examined relatively complex multi-alternative multi-outcome tasks, but not in Studies 1 and 3, which examined simple two-alternative two-outcome choice tasks. A possible explanation for the different predictive value of the two examined hypotheses is discussed.

Keywords: The hot stove effect; Underweighting of rare events; Decisions from experience; Clicking paradigm; Recency effect; Dialectical thinking (search for similar items in EconPapers)
JEL-codes: C91 D81 D83 (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:joepsy:v:49:y:2015:i:c:p:47-58

DOI: 10.1016/j.joep.2015.04.001

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