Search results

1 – 10 of over 4000
To view the access options for this content please click here
Article
Publication date: 4 April 2017

James Prater, Konstantinos Kirytopoulos and Tony Ma

One of the major challenges for any project is to prepare and develop an achievable baseline schedule and thus set the project up for success, rather than failure. The…

Downloads
2942

Abstract

Purpose

One of the major challenges for any project is to prepare and develop an achievable baseline schedule and thus set the project up for success, rather than failure. The purpose of this paper is to explore and investigate research outputs in one of the major causes, optimism bias, to identify problems with developing baseline schedules and analyse mitigation techniques and their effectiveness recommended by research to minimise the impact of this bias.

Design/methodology/approach

A systematic quantitative literature review was followed, examining Project Management Journals, documenting the mitigation approaches recommended and then reviewing whether these approaches were validated by research.

Findings

Optimism bias proved to be widely accepted as a major cause of unrealistic scheduling for projects, and there is a common understanding as to what it is and the effects that it has on original baseline schedules. Based upon this review, the most recommended mitigation method is Flyvbjerg’s “Reference class,” which has been developed based upon Kahneman’s “Outside View”. Both of these mitigation techniques are based upon using an independent third party to review the estimate. However, within the papers reviewed, apart from the engineering projects, there has been no experimental and statistically validated research into the effectiveness of this method. The majority of authors who have published on this topic are based in Europe.

Research limitations/implications

The short-listed papers for this review referred mainly to non-engineering projects which included information technology focussed ones. Thus, on one hand, empirical research is needed for engineering projects, while on the other hand, the lack of tangible evidence for the effectiveness of methods related to the alleviation of optimism bias issues calls for greater research into the effectiveness of mitigation techniques for not only engineering projects, but for all projects.

Originality/value

This paper documents the growth within the project management research literature over time on the topic of optimism bias. Specifically, it documents the various methods recommended to mitigate the phenomenon and highlights quantitatively the research undertaken on the subject. Moreover, it introduces paths for further research.

Details

International Journal of Managing Projects in Business, vol. 10 no. 2
Type: Research Article
ISSN: 1753-8378

Keywords

To view the access options for this content please click here
Article
Publication date: 18 February 2021

Hao Chen, Ofir Turel and Yufei Yuan

Electronic waste (e-waste) such as discarded computers and smartphones may contain large amounts of confidential data. Improper handling of remaining information in…

Abstract

Purpose

Electronic waste (e-waste) such as discarded computers and smartphones may contain large amounts of confidential data. Improper handling of remaining information in e-waste can, therefore, drive information security risk. This risk, however, is not always properly assessed and managed. The authors take the protection motivation theory (PMT) lens of analysis to understand intentions to protect one's discarded electronic assets.

Design/methodology/approach

By applying structural equation modeling, the authors empirically tested the proposed model with survey data from 348 e-waste handling users.

Findings

Results highlight that (1) protection intention is influenced by the perceived threat of discarding untreated e-waste (a threat appraisal) and self-efficacy to treat the discarded e-waste (a coping appraisal) and (2) optimism bias plays a dual-role in a direct and moderating way to reduce the perceived threat of untreated e-waste and its effect on protection intentions.

Originality/value

Results support the assertions and portray a unique theoretical account of the processes that underline people's motivation to protect their data when discarding e-waste. As such, this study explains a relatively understudied information security risk behavior in the e-waste context, points to the role of optimism bias in such decisions and highlights potential interventions that can help to alleviate this information security risk behavior.

Details

Information Technology & People, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0959-3845

Keywords

To view the access options for this content please click here
Article
Publication date: 8 June 2015

Jaya Mamta Prosad, Sujata Kapoor and Jhumur Sengupta

– The purpose of this paper is to capture the presence and impact of optimism in the Indian equity market.

Abstract

Purpose

The purpose of this paper is to capture the presence and impact of optimism in the Indian equity market.

Design/methodology/approach

The data set comprises the daily values of the Nifty 50 index, index options and Treasury-bill index for a period of five years (2006-2011). The focus of this paper is two pronged. It first investigates the presence of optimism (pessimism) using the pricing kernel technique suggested by Barone-Adesi et al. (2012). Second, it tries to analyze the relationship of this bias with stock market indicators like risk premium, market return and volatility using time series regression.

Findings

The findings indicate that the Indian equity market has been predominantly pessimistic from the period 2006 to 2011. The interaction of this bias with market indicators also unveils some interesting insights. The study shows that high past volatility can lead to pessimism in the Indian equity market and vice versa. It further explores that when the investors are rational, their risk and return relationship is positive while it tends to be negative when they are irrational. The impact of investors’ irrationalities on asset valuation has also been accounted by Brown and Cliff (2005).

Research limitations/implications

The findings of the paper have significant implications for fund managers and asset management companies. It is recommended that they should try to identify behavioral biases in their clients before designing their portfolios.

Originality/value

This study is one of the very few attempts to capture the presence and impact optimism (pessimism) in the Indian equity market.

Details

Review of Behavioral Finance, vol. 7 no. 1
Type: Research Article
ISSN: 1940-5979

Keywords

To view the access options for this content please click here
Article
Publication date: 7 November 2018

Wagner Junior Ladeira, Fernando Oliveira Santini, Diego Costa Pinto, Clécio Falcao Araujo and Fernando A. Fleury

This paper aims to analyze how judgment bias (optimism vs pessimism) and temporal distance influence self-control decisions. This research also analyzes the mediating role…

Abstract

Purpose

This paper aims to analyze how judgment bias (optimism vs pessimism) and temporal distance influence self-control decisions. This research also analyzes the mediating role of perceived control on judgment bias and temporal distance.

Design/methodology/approach

Three studies (one laboratory and two online experiments) analyze how judgment bias and temporal distance influence self-control decisions on consumers’ willingness to pay.

Findings

The findings uncover an important boundary condition of temporal distance on self-control decisions. In contrast to previous research, the findings indicate that individuals exposed to optimism (vs pessimism) bias display more self-control in the future and make choices that are more indulgent in the present. The findings also reveal that perceived control mediates the effects of judgment bias and temporal distance.

Practical implications

The findings help managers to adapt short- and long-term marketing efforts, based on consumers’ momentary judgment biases and on their chronic judgment bias orientation.

Originality/value

This research contributes to the literature on self-control and temporal distance, showing that judgment bias reverses previous research findings on self-control decisions.

Details

Journal of Consumer Marketing, vol. 35 no. 5
Type: Research Article
ISSN: 0736-3761

Keywords

To view the access options for this content please click here
Article
Publication date: 25 July 2019

Harit Satt, Sarah Nechbaoui, M. Kabir Hassan and Selma Izadi

This paper aims to document the impact of Ramadan on the optimism of analysts’ recommendations taking as a sample the countries of the MENA region during the period…

Abstract

Purpose

This paper aims to document the impact of Ramadan on the optimism of analysts’ recommendations taking as a sample the countries of the MENA region during the period between 2004 and 2015. The choice of these countries can be explained by the fact that their population is predominantly of a Muslim faith (The Future of World Religions: Population Growth Projections, 2010-2050, 2015).

Design/methodology/approach

The authors used univariate and multivariate regression models to highlight the existence of the Ramadan effect on the optimism of analysts. They have found that pre-holiday optimism is significantly lower than post-holiday optimism.

Findings

This paper also documented the effect of analysts’ experience and information uncertainty on the analysts’ optimism level that allowed us to infer that low experience enhances optimism, while environment with low information uncertainty tends to decrease the level of optimism.

Originality/value

Previous research on this topic has investigated the effect of months of the year, turns of the month and days-of-the-week on the behavior of stock exchanges. Another strand of the literature also analyzed the effect of holidays on the latter. However, this is the first attempt to investigate this effect on analysts’ recommendations optimism when the holiday period is related to Islam.

Details

International Journal of Islamic and Middle Eastern Finance and Management, vol. 12 no. 5
Type: Research Article
ISSN: 1753-8394

Keywords

To view the access options for this content please click here
Article
Publication date: 3 August 2015

Jaya Mamta Prosad, Sujata Kapoor and Jhumur Sengupta

The purpose of this paper is to examine the presence the behavioral biases in Indian investors specifically, overconfidence, excessive optimism (pessimism), herd behavior…

Downloads
1531

Abstract

Purpose

The purpose of this paper is to examine the presence the behavioral biases in Indian investors specifically, overconfidence, excessive optimism (pessimism), herd behavior and the disposition effect. It further investigates the role of demographics and investor sophistication in influencing the biases. Finally, it reveals which bias is most prevalent in the Indian context.

Design/methodology/approach

For this purpose, a survey has been conducted on the investors of the Delhi/NCR area. The data have been collected with the help of a structured questionnaire that is analyzed with the help of relevant statistical tools.

Findings

The survey evidence shows that behavioral biases are dependent on investors’ demographics and their trading sophistication with highest influencing factors being age, profession and trading frequency. Each bias corresponds to a specific set of investor characteristics and overconfidence comes out to be the most important bias in the Indian context.

Research limitations/implications

The potential limitations of the present survey can be ascribed to socially desirable responses and their difference with actual market behavior. Further, due to time and resource constraint, the data set is limited to investors of only Delhi/NCR.

Practical implications

This study is most relevant for financial advisors, as it facilitates them in gaining a better understanding of their clients’ psychology. It can aid them in developing behaviorally modified portfolio, which best suits their clients’ predisposition.

Originality/value

The paper gives a unique insight on the investors’ profile corresponding to each bias under consideration. It not only updates the evidence on behavioral biases but also highlights which bias is the most influential in the Indian context.

Details

Qualitative Research in Financial Markets, vol. 7 no. 3
Type: Research Article
ISSN: 1755-4179

Keywords

To view the access options for this content please click here
Article
Publication date: 24 August 2020

Taofik Hidajat, Ina Primiana, Sulaeman Rahman and Erie Febrian

This paper aims to identify psychological factors that influence people to be involved in Ponzi and pyramid schemes.

Abstract

Purpose

This paper aims to identify psychological factors that influence people to be involved in Ponzi and pyramid schemes.

Design/methodology/approach

A psychological approach to finance or behavioural finance is applied in this research because of the assumption that human beings are not always rational. The sample consisted of 98 investors in 11 cities in Indonesia who were or had invested in an investment program with a Ponzi or pyramid scheme. The snowball sampling technique was applied.

Findings

The conclusion is that optimism (emotional bias), confirmation bias, representativeness bias, framing bias and overconfidence (cognitive bias) positively influenced investment decisions related to Ponzi and pyramid schemes.

Originality/value

The novelty aspect of this research is the implementation of a behavioural finance perspective to answer and express the fascinating phenomenon of Ponzi and pyramid investment schemes.

Details

Journal of Financial Crime, vol. 28 no. 1
Type: Research Article
ISSN: 1359-0790

Keywords

To view the access options for this content please click here
Article
Publication date: 10 June 2020

Yasmine Souissi, Bassem Salhi and Anis Jarboui

The purpose of this paper is to document the relation between the bank’s regional CEO’s emotional bias (optimism and loss aversion) and the delegation of decision rights…

Abstract

Purpose

The purpose of this paper is to document the relation between the bank’s regional CEO’s emotional bias (optimism and loss aversion) and the delegation of decision rights to the account manager.

Design/methodology/approach

The partial least squares (PLS) method is applied to investigate the degree to which bank’s regional CEO delegate decisions and the circumstances that drive variation in delegation.

Findings

The results show that delegation does not appear to be monolithic; instead, the results show that delegation varies with the personal characteristics of the bank’s regional CEO.

Practical implications

Banks are invited to take into account the effect of the emotional biases of the directors on the delegation of its power.

Originality/value

The authors put forward an original effort that is intended to discuss in particular the effect of psychological biases on the decentralization of the decision-making rights.

Details

International Journal of Law and Management, vol. 62 no. 5
Type: Research Article
ISSN: 1754-243X

Keywords

To view the access options for this content please click here
Article
Publication date: 16 October 2017

Xiaoxiang Zhang, Jo-Ting Wei and Hsin-Hung Wu

The purpose of this paper is to examine how family firms affect analyst forecast dispersion, accuracy and optimism and how earnings smoothness as the moderating factor…

Abstract

Purpose

The purpose of this paper is to examine how family firms affect analyst forecast dispersion, accuracy and optimism and how earnings smoothness as the moderating factor, affects these relationships in an emerging market context.

Design/methodology/approach

This paper uses the population sample of firms listed on the Taiwan Stock Exchange from 2009 to 2010 as the research sample, which includes 963 firm-year observations.

Findings

The findings show that analysts following family firms are more likely to have more dispersed, less accurate and more optimism biased forecasts than those following nonfamily firms. Earning smoothness is mainly used by nonfamily firms as a signaling strategy to improve analyst forecast quality. In contrast, earnings smoothness is mainly used by families as a garbling strategy, stimulating forecast optimism. Only earnings smoothness in family firms with a high level of family ownership concentration is likely to be signaling-oriented to improve analyst forecast accuracy and mitigate analyst optimism biases.

Originality/value

Emerging markets are not only featured by prevailing principal-principal conflicts but also have multiple levels of agency conflicts among large shareholders, minority shareholders and professionally hired managers. This research reveals the multiple governance roles of family owners in affecting analyst forecast quality, including their entrenchment role in extracting private benefits of control through opaque environments and market discipline distortion role in aligning interests between managers and families without prioritizing meeting or beating analyst forecasts, both at the cost of minority shareholders. This research further disentangles the intertwined signaling oriented and garbiling oriented incentives associated with earnings smoothness under family governance.

Details

Management Decision, vol. 55 no. 9
Type: Research Article
ISSN: 0025-1747

Keywords

To view the access options for this content please click here
Article
Publication date: 28 February 2019

Sai On Cheung and Keyao Li

This study aims to propose a framework of bias in construction project dispute resolution (CPDR hereafter).

Abstract

Purpose

This study aims to propose a framework of bias in construction project dispute resolution (CPDR hereafter).

Design/methodology/approach

With reference to the literatures on effects of bias, manifestations of bias in CPDR were developed. Based on data obtained from construction professionals about their frequency of having these bias manifestations, the underlying constructs of biased behaviors were explored by a principal component factor analysis. A confirmatory factor analysis was further conducted to validate the framework of bias in CPDR.

Findings

Four types of bias were identified as the constructs that underlie biased behaviors in CPDR. These four biases were included in the bias framework proposed: preconception, self-affirmation, optimism and interest-oriented. The potency of these types of bias was also evaluated.

Practical implications

First, the findings inform that the existence of bias in CPDR is real. Early detection allows management to intervene and steer CPDR team back to rational courses. Second, this study suggests optimizing CPDR procedures to diminish the chance of bias occurring.

Originality/value

Bias is almost an uncharted area in CPDR. The study fills this research gap by conceptualizing the underlying constructs of biased behaviors. The findings inform construction professionals of the likelihood of practicing biased behaviors in CPDR. Repeated dispute decisions in the commonly used multi-tiered dispute resolution process would enable the creeping in of biases.

Details

Engineering, Construction and Architectural Management, vol. 26 no. 2
Type: Research Article
ISSN: 0969-9988

Keywords

1 – 10 of over 4000