Abstract
The purpose of this study is to determine the role of anchoring bias in the economic and financial information. An experiment involving the business students is carried out by providing them information about recent economic and financial anchors about stock market, index returns, inflation and exchange rates in groups where one groups is exposed to some relevant anchors. In the first group, which is the “control group” the participants were given no relevant information and were asked to give their best estimate for all the respective indicators. In the second group the “anchoring group” participants were asked the same questions but are provided indicator anchors to deduce their anchoring estimates, for instance the current value of KSE-100 index is provided, and the respondents were asked to predict the current value of KSE-30 index. The results show that there is significant degree of anchoring bias for each of the questions and it is higher for males as compare to females. Similarly, the respondents when exposed to relevant anchors show significant anchoring bias than for irrelevant anchors. Keywords: Anchoring Bias, Relevant Anchoring, Irrelevant Anchoring, Perceived Relevance, Financial Indicators.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
More From: International Review of Management and Business Research
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.