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Risk, Time Pressure, and Selection Effects

Author

Listed:
  • Kocher, Martin

    (University of Vienna)

  • Schindler, David

    (Tilburg University)

  • Trautmann, Stefan

    (University of Heidelberg)

  • Xu, Yilong

    (Uinversity of Heidelberg)

Abstract

Time pressure is a central aspect of economic decision making nowadays. It is therefore natural to ask how time pressure affects decisions, and how to detect individual heterogeneity in the ability to successfully cope with time pressure. In the context of risky decisions, we ask whether a person\'s performance under time pressure can be predicted by measurable behavior and traits, and whether such measurement itself may be affected by selection issues. We find that the ability to cope with time pressure varies significantly across decision makers, leading to selected subgroups that differ in terms of their observed behaviors and personal traits. Moreover, measures of cognitive ability and intellectual efficiency jointly predict individuals\' decision quality and ability to keep their decision strategy under time pressure.

Suggested Citation

  • Kocher, Martin & Schindler, David & Trautmann, Stefan & Xu, Yilong, 2018. "Risk, Time Pressure, and Selection Effects," Rationality and Competition Discussion Paper Series 84, CRC TRR 190 Rationality and Competition.
  • Handle: RePEc:rco:dpaper:84
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    References listed on IDEAS

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    Cited by:

    1. Wolff, Irenaeus, 2019. "The reliability of questionnaires in laboratory experiments: What can we do?," Journal of Economic Psychology, Elsevier, vol. 74(C).
    2. Katarzyna Gawryluk & Michal Krawczyk, 2019. "Additional deliberation reduces pessimism: evidence from the double-response method," Journal of the Economic Science Association, Springer;Economic Science Association, vol. 5(1), pages 51-64, August.
    3. Joaquina Couto & Leendert van Maanen & Maël Lebreton, 2020. "Investigating the origin and consequences of endogenous default options in repeated economic choices," PLOS ONE, Public Library of Science, vol. 15(8), pages 1-19, August.
    4. Justin Buffat & Matthias Praxmarer & Matthias Sutter, 2020. "The Intrinsic Value of Decision Rights: A Note on Team vs Individual Decision-Making," Discussion Paper Series of the Max Planck Institute for Research on Collective Goods 2020_30, Max Planck Institute for Research on Collective Goods.
    5. De Paola, Maria & Gioia, Francesca & Pupo, Valeria, 2020. "Selection and Incentives under Time Pressure: The Importance of Framing," IZA Discussion Papers 13474, Institute of Labor Economics (IZA).
    6. Dilmaghani, Maryam, 2020. "Gender differences in performance under time constraint: Evidence from chess tournaments," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 89(C).
    7. Ennio Bilancini & Leonardo Boncinelli & Lorenzo Spadoni, 2020. "Motivating Risky Choices Increases Risk Taking," Working Papers CESARE 1/2020, Dipartimento di Economia e Finanza, LUISS Guido Carli.
    8. Aurélie Dariel & Nikos Nikiforakis & Jan Stoop, 2020. "Does selection bias cause us to overestimate gender differences in competitiveness?," Working Papers 20200046, New York University Abu Dhabi, Department of Social Science, revised May 2020.
    9. Steven Tucker & Yilong Xu, 2020. "Nonspeculative Bubbles Revisited: Speculation Does Matter," Working Papers in Economics 20/09, University of Waikato.

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    More about this item

    Keywords

    risk; cognitive ability; selection; time pressure;
    All these keywords.

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty

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