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Decision making biased: How visual illusion, mood, and information presentation plays a role

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  • Rosdini, Dini
  • Sari, Prima Yusi
  • Amrania, Gia Kardina Prima
  • Yulianingsih, Pera

Abstract

This study aims to investigate whether information presentation, visual illusion, and mood lead to decision making bias in interpreting financial statements. This study is a quantitative research using an experiment method. The results of this study indicate that the information presented in the table provides a better accuracy, also that financial information presented in bar graphs is more informative and provides a higher level of accuracy compared to line charts. Graphical display without gridlines will cause bias in reading financial statements. This study also showed that when participants experiencing a natural/stable mood, they can make the decision correctly; but when they are in an unpleasant mood, they are not able to make the decision correctly. This paper contributes to examining the factors that influence decision making biases comprehensively.

Suggested Citation

  • Rosdini, Dini & Sari, Prima Yusi & Amrania, Gia Kardina Prima & Yulianingsih, Pera, 2020. "Decision making biased: How visual illusion, mood, and information presentation plays a role," Journal of Behavioral and Experimental Finance, Elsevier, vol. 27(C).
    • Handle: RePEc:eee:beexfi:v:27:y:2020:i:c:s2214635020300034
    DOI: 10.1016/j.jbef.2020.100347
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    References listed on IDEAS

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    1. Kumar, Satish & Rao, Sandeep & Goyal, Kirti & Goyal, Nisha, 2022. "Journal of Behavioral and Experimental Finance: A bibliometric overview," Journal of Behavioral and Experimental Finance, Elsevier, vol. 34(C).

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