Statistical formats to optimize evidence-based decision making: a behavioral approach

Iván Arribas, Irene Comeig, Amparo Urbano and Jose Vila ()

No 513, Discussion Papers in Economic Behaviour from University of Valencia, ERI-CES

Abstract: Statistical information is crucial for managerial decision making. The decision-making literature in psychology and mathematical cognition documents how different statistical formats can facilitate certain types of decisions. The present analysis is the first of its kind to assess the impact of statistical formats in the presentation of data from market research on both the optimality of market decisions and the time required to perform the decision-making process. An economic experiment provides the data for this study. The experiment presents statistical information in simple frequencies and relative frequencies using numerical and pictorial representations in the context of different informational environments. The key findings are that statistical information presented in terms of relative frequency formats gives rise to more accurate decision making than data presented in terms of simple frequencies, independently of the informational environments. When time is the relevant variable, numerical formats lead to a faster interpretation than pictorial ones. Since the number of factors defining the four statistical formats and the different informational environments is quite large, an orthogonal design offers a suitable experimental design. This design keeps the experiment manageable without substantially reducing its analytical power

Keywords: Economic experiments; Statistical formats; Probability judgment; Orthogonal design; Judgment under uncertainty (search for similar items in EconPapers)
Date: 2013-10
New Economics Papers: this item is included in nep-cbe, nep-cdm and nep-exp
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.uv.es/erices/RePEc/WP/2013/0513.pdf (application/pdf)

Related works:
Journal Article: Statistical formats to optimize evidence-based decision making: A behavioral approach (2014)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:dbe:wpaper:0513

Access Statistics for this paper

More papers in Discussion Papers in Economic Behaviour from University of Valencia, ERI-CES Contact information at EDIRC.
Bibliographic data for series maintained by Emilio Calvo Ramón ().