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This paper aims to provide an elucidative and explanatory overview of decision-making theory that human resource management and development (HR) researchers and practitioners can use to explore the impact of heuristics and biases on organizational decisions, particularly within HR contexts.

This paper draws upon three theoretical resources anchored in decision-making research: the theory of bounded rationality, the heuristics and biases program, and cognitive-experiential self-theory (CEST). A selective narrative review approach was adopted to identify, translate, and contextualize research findings that provide immense applicability, connection, and significance to the field and study of HR.

The authors extract key insights from the theoretical resources surveyed and illustrate the linkages between HR and decision-making research, presenting a theoretical framework to guide future research endeavors.

Decades of decision-making research have been distilled into a digestible and accessible framework that offers both theoretical and practical implications.

Heuristics are mental shortcuts that facilitate quick decisions by simplifying complexity and reducing effort needed to solve problems. Heuristic strategies can yield favorable outcomes, especially amid time and information constraints. However, heuristics can also introduce systematic judgment errors known as biases. Biases are pervasive within organizational settings and can lead to disastrous decisions. This paper provides HR scholars and professionals with a balanced, nuanced, and integrative framework to better understand heuristics and biases and explore their organizational impact. To that end, a forward-looking and direction-setting research agenda is presented.

This paper aims to evaluate and structure the basic heuristics consumers use in evaluating word-of-mouth (WOM) about luxury hotel brands while analyzing the impact of deception in online consumer reviews.

The research used a two-study mixed-methods approach, using interpersonal deception theory and social proof theory as lenses to conduct our analysis. For the first study, a qualitative conceptual mapping analysis was conducted, examining online consumer reviews to identify key concepts and their relationships in the context of luxury hotel brands. In the second study, the themes were further examined using a fuzzy-set qualitative comparative analysis to analyze their causal complexity and association between variables to determine how they influence the perceived helpfulness of online reviews for luxury hotel brands.

The results underline the importance of functional, objective variables, such as the number of reviews and stars, as social proof heuristics and other factors, including clout, authenticity and analytic tone, as interpersonal communication heuristics. Therefore, consumers use a combination of social and interpersonal communication heuristics to extract information from reviews and manage deception risk.

The paper contributes to the consumer–brand relationship literature by assessing the heuristics consumers use in evaluating online reviews and provides additional information for research in online reputation management.

This study’s results can help marketing practitioners and brand managers manage their online reputations better. It can also aid managers in improving their messaging on hotel websites to entice consumers to complete bookings. Heuristics play an essential role in such messaging and understanding them can help marketers appeal directly to their target market.

This study contributes to the literature on consumer–brand relationships by providing a framework of heuristics that consumers use when evaluating luxury service brands and contributes to WOM and online reputation research by highlighting factors that may make online reviews more helpful.

This paper aims to provide a novel explorative perspective on fund managers’ decisions under uncertainty. The current COVID pandemic is used as a unique reference frame to study how heuristics are used in institutional financial practice.

This study follows a grounded theory approach. A total of 282 diverse publications between October 2019 and October 2020 for 20 German mutual funds are qualitatively analyzed. A theory of adaptive heuristics for fund managers is developed.

Fund managers adapt their heuristics during a crisis and this adaptive process flows through three stages. Increasing complexity in the environment leads to the adaption of simplest heuristics around investment decisions. Three distinct stages of adaption: precrisis, uncertainty and stabilization emerge from the data.

This study’s data is based on publicly available information. There might be a discrepancy between publicly stated and internal reasoning.

Money managers can use the provided framework to assess their decision-making in crises. The developed adaptive processes of heuristics can assist capital allocators who choose and rate fund managers. Policymakers and regulators can learn about the aspects of investor decisions that their actions and communication address. Teaching can use this study to exemplify the nature of financial markets as adaptive systems rather than static structures.

To the best of the author’s/authors’ knowledge, this study is the first to systematically explore the heuristics of professional money managers because they navigate a large-scale exogenous crisis.

Organizational wicked problems are ill-defined phenomena arising in complex environments with intertwined and evolving interests. This paper aims to use a nonlinear epistemological approach to explore how multiple management decision tools work together to form configurational paths to deal with organizational wicked problems and to propose some heuristic toolkits for tackling them.

Based on interviews with 53 senior executives dealing with 62 organizational wicked problems, this paper uses grounded theory to construct an antecedent theoretical framework and then uses qualitative comparative analysis (QCA) to conduct configuration analysis on the strategy portfolios that can tackle organizational wicked problems.

This paper used grounded theory to identify six theoretical dimensions as management decision tools for dealing with organizational wicked problems: change adaptation, goal performing, administration, mechanical integration, organic integration and entrepreneuring. In addition, this paper used QCA to explore and propose three heuristic toolkits – synergy oriented, institution oriented and innovation oriented – as multiple equivalent paths to help deal with organizational wicked problems.

This paper uses configuration analysis instead of the net effect analysis of the traditional econometric method and captures multiple antecedent conditions for decision-makers to deal with organizational wicked problems from a holistic perspective. This paper constructs three heuristic toolkits and matches each of them with the most suitable type of organizational wicked problem, constructing a complete research chain of “identifying–tackling” the organizational wicked problem and providing a reference for organizations facing similar situations in future practice.

We argue that a fundamental issue regarding how to search and how to switch between different cognitive modes lies in the decision rules that influence the dynamics of learning and exploration. We examine the search logics underlying these decision rules and propose conceptual prompts that can be applied mentally or computationally to aid managers’ decision-making.

By applying Multi-Armed Bandit (MAB) modeling to simulate agents’ interaction with dynamic environments, we compared the patterns and performance of selected MAB algorithms under different configurations of environmental conditions.

We develop three conceptual prompts. First, the simple heuristic-based exploration strategy works well in conditions of low environmental variability and few alternatives. Second, an exploration strategy that combines simple and de-biasing heuristics is suitable for most dynamic and complex decision environments. Third, the uncertainty-based exploration strategy is more applicable in the condition of high environmental unpredictability as it can more effectively recognize deviated patterns.

This study contributes to emerging research on using algorithms to develop novel concepts and combining heuristics and algorithmic intelligence in strategic decision-making.

This study offers insights that there are different possibilities for exploration strategies for managers to apply conceptually and that the adaptability of cognitive-distant search may be underestimated in turbulent environments.

Drawing on insights from machine learning and cognitive psychology research, we demonstrate the fitness of different exploration strategies in different dynamic environmental configurations by comparing the different search logics that underlie the three MAB algorithms.

Despite its devastating nature, the COVID-19 pandemic has also catalyzed a substantial surge in the adoption and integration of technological tools within economies, exerting a profound influence on the dissemination of information among participants in stock markets. Consequently, this present study delves into the ramifications of post-pandemic dynamics on stock market behavior. It also examines the relationship between investors' sentiments, underlying behavioral drivers and their collective impact on global stock markets.

Drawing upon data spanning from 2012 to 2023 and encompassing major world indices classified by Morgan Stanley Capital International’s (MSCI) market and regional taxonomy, this study employs a threshold regression model. This model effectively distinguishes the thresholds within these influential factors. To evaluate the statistical significance of variances across these thresholds, a Wald coefficient analysis was applied.

The empirical results highlighted the substantive role that investors' sentiments and behavioral determinants play in shaping the predictability of returns on a global scale. However, their influence on developed economies and the continents of America appears comparatively lower compared with the Asia–Pacific markets. Similarly, the regions characterized by a more pronounced influence of behavioral factors seem to reduce their reliance on these factors in the post-pandemic landscape and vice versa. Interestingly, the post COVID-19 technological advancements also appear to exert a lesser impact on developed nations.

This study pioneers the investigation of these contextual dissimilarities, thereby charting new avenues for subsequent research studies. These insights shed valuable light on the contextualized nexus between technology, societal dynamics, behavioral biases and their collective impact on stock markets. Furthermore, the study's revelations offer a unique vantage point for addressing market inefficiencies by pinpointing the pivotal factors driving such behavioral patterns.

This paper examines the relationship between behavioral biases, and demand decisions for life insurance products in Uganda.

Data were collected from 351 life insurance policyholders in Uganda. The authors used a cross-sectional survey by applying a structured questionnaire. Descriptive analysis was conducted and hypothesized relationships between the constructs were evaluated through the use of structural equation modeling.

Results indicate that, behavioral biases are significant predictors of life insurance demand among Ugandan policyholders. Also, the two behavioral bias variables (heuristic bias and prospect bias) are significant predictors of demand decisions for life insurance products.

These results are helpful for both insurers and regulators. For insurers, it is now evident that demand decisions for life insurance products are not fully rational. It is imperative for insurers to simplify life insurance product information (heuristics), integrate product education and widen dissemination of product information (prospect bias) to allow policyholders to come up with optimal demand decisions. While for insurance policymakers, the study provides an understanding of behavioral biases. With such insights, policymakers can identify exploitative and deceptive information that target policyholders to better guide life insurance documentation and product designs.

This study is the first to offer insights into behavioral biases' influence on demand decisions for life insurance products in a developing country like Uganda. By integrating prospects and expected utility theory, this study examines rationality and irrationality in demand decisions for life insurance products.

The peer review history for this article is available at: https://publons.com/publon/10.1108/IJSE-03-2023-0201

Most scientific research has focused on understanding Ponzi schemes from the point of view of the schemes and their operators, based on qualitative analysis. This paper aims to analyze Ponzi schemes from the perspective of their investors, emphasizing behavioral aspects, which have been little explored in the scientific literature, especially in quantitative research. In this way, the authors sought to understand the effects of heuristics and cognitive biases in understanding investor behavior.

A logistic regression was carried out with Brazilian investors, some of them participants in Ponzi schemes, who answered a structured questionnaire by means of a survey.

The authors found that social pressures, overconfidence and deliberate ignorance lead to credulity, generating little risk analysis and the desire to make a lot of money quickly.

Helping investors improve their levels of information through financial education and self-knowledge about their behavior. Contribute to the competent authorities in the search for improvements in the information displayed to investors.

Understanding the mechanisms used when making a financial decision from the point of view of investors in general, but especially those exposed to Ponzi schemes, has the mission of enlightening them about the importance of financial education and the weight of psychological factors so that they can reduce the effects of heuristics and analysis biases when faced with a financial decision.

The basis of this work will be the inclusion of psychological variables and financial education, adapting existing models in an attempt to demonstrate the effects they may or may not have on mental accounting in the specific case of investors

This study aims to investigate the impact of financial and behavioural factors on investment decisions in the cryptocurrency market within the Gulf Cooperation Council (GCC).

The study uses the cross-sectional absolute deviation methodology developed by Chang et al. (2000) to determine the existence of herding behaviour during extreme conditions in the cryptocurrency market of four GCC countries: Bahrain, Saudi Arabia, Kuwait and UAE. In addition, a questionnaire survey was distributed to 322 investors from the GCC cryptocurrency markets to gather data on their investment decisions.

The study finds that the herding theory, prospect theory and heuristics theory account for 16.5% of the variance in investors' choices in the GCC cryptocurrency market. The regression analysis results show no multicollinearity problems, and a high F-statistic indicates the general model's acceptability in the results.

The study's findings suggest that behavioural and financial factors play a significant role in investors' choices in the GCC cryptocurrency market. The study's results can be used by investors to better understand the impact of these factors on their investment decisions and to develop more effective investment strategies. In addition, the study's findings can be used by policymakers to develop regulations that consider the impact of behavioural and financial factors on the GCC cryptocurrency market.

This study adds to the body of literature in two different ways. Initially, motivated by earlier research examining the impact of behaviour finance factors on investment decisions, the authors look at how the behaviour finance factors affect investment decisions of the GCC cryptocurrency market. To extend most of these studies, this study uses a regime-switching model that accounts for two different market states. Second, by considering the recent crisis and more recent periods involving more cryptocurrencies, the authors have contributed to several studies examining the impact of behavioural financial factors on investment decisions in cryptocurrency markets. In fact, very few studies have examined the impact of behavioural finance on cryptocurrency markets. Therefore, to the best of the authors’ knowledge, this study is the first of its kind to investigate how behavioural finance factors influence investment decisions in the GCC cryptocurrency market. This allows to better illuminate the factors driving herd behaviour in the GCC cryptocurrency market.

This research aims to elucidate why consumers decide to eat meals that seem to be higher in calories and salt, despite their goal being to consume fewer calories and sodium. Korean participants are to be used for this study. The present research further investigated the impacts of categorization and averaging bias in relation to the health halo phenomenon, specifically focusing on traditional food and textured vegetable protein (soy meat) burgers. Thus, the present research investigated how consumers' intentions contrasted with their consumption goals in food choice circumstances.

We partitioned the survey due to the COVID-19 epidemic. A single, well trained surveyor first surveyed customers at cafés in Seoul and six other Korean cities. We received 102 in-person survey replies. A total of 254 advanced degree or undergraduate students from two universities completed an online questionnaire. There are 356 responses. Two studies were conducted where participants were instructed to evaluate the perceived healthiness, calorie content, and sodium level of different food items. The specifics of each study are elucidated in the main body of the paper.

This study shows that Koreans categorize meals as virtue or vice depending on their perceived healthiness, validating the categorization effect. Furthermore, this research demonstrated that consumers' perceptions of the health benefits of traditional meals and soy meat burgers impact their categorization. Koreans also assessed the average of the vice and virtue and found vice-virtue combination meals healthier than the vice alone. This affects how calories and sodium are perceived. This study also shown that high virtue affects averaging bias more than weak virtue in meals with vice and virtue combo.

This study extended food categorization and averaging bias to non-US consumers and confirmed this contradictory meal choice is universal. Health halo also affects food health perception. The results of this study revealed that Koreans consider traditional food healthier than western junk food. Korean customers incorrectly assume soy meat burgers have fewer calories and sodium than regular burgers. Thus, this study explains Korean consumers' food health misconceptions related to paradoxical consumption.