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Hit or Miss: What Leads Experts to Take Advice for Long-Term Judgments?

Author

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  • Philipp Ecken

    (Julius-Maximilians-Universität Würzburg, 97070 Würzburg, Germany; and EBS Business School, 65189 Wiesbaden, Germany)

  • Richard Pibernik

    (Julius-Maximilians-Universität Würzburg, 97070 Würzburg, Germany)

Abstract

Managers and policy makers frequently face crucial strategic decisions that inevitably rely on judgments about relevant future events. These judgments are often characterized by very high uncertainty and the absence of experience from previous good or bad judgments. Judgments of other experts are oftentimes an important—sometimes the only—source of additional information to reduce uncertainty and improve judgment accuracy. However, in many practical situations, decision makers have very limited means to evaluate the quality of such “advice” from other experts and could tend to ignore this valid source of information. In this paper, we study what leads decision makers to take advice from an expert panel when judging the probability of far-future events with high economic impact. Our analysis is based on a unique data set that comprises more than 15,000 advice-taking decisions made by almost 1,000 experts from different industries. We find that decision makers have a strong tendency to ignore advice, which pronounces even further when conflicts in terms of beliefs, past experiences, or desires arise. This paper was accepted by Yuval Rottenstreich, judgment and decision making.

Suggested Citation

  • Philipp Ecken & Richard Pibernik, 2016. "Hit or Miss: What Leads Experts to Take Advice for Long-Term Judgments?," Management Science, INFORMS, vol. 62(7), pages 2002-2021, July.
    • Handle: RePEc:inm:ormnsc:v:62:y:2016:i:7:p:2002-2021
    DOI: 10.1287/mnsc.2015.2219
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    References listed on IDEAS

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    2. Jack B. Soll & Asa B. Palley & Christina A. Rader, 2022. "The Bad Thing About Good Advice: Understanding When and How Advice Exacerbates Overconfidence," Management Science, INFORMS, vol. 68(4), pages 2949-2969, April.
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    4. Christoph Markmann & Alexander Spickermann & Heiko A. von der Gracht & Alexander Brem, 2021. "Improving the question formulation in Delphi‐like surveys: Analysis of the effects of abstract language and amount of information on response behavior," Futures & Foresight Science, John Wiley & Sons, vol. 3(1), March.

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