William Hakes- Org. Behavior and Human Decision Processes Article Summary
1) “Familiarity Bias and Belief Reversal in Relative Likelihood Judgment” Organizational Behavior and Human Decision Processes; Craig R. Fox and Jonathan Levav. Vol 82, No. 2, July, pp. 268-292, 2000.
2) Craig R. Fox and Jonathan Levav, Fuqua School of Business, Duke University. firstname.lastname@example.org.
3) Is the assignment of relative likelihood of separate events upwardly (downwardly) biased by the familiarity (lack of familiarity) of an agent with the events in question?
4) Applied Theoretical: In this article, the authors further our current understanding of the concept of decision-making biases by conducting experiments in different sets of subjects.
5) Subjective probability assessment, and its analysis thereof, is an interesting foray into the human decision-making process. Using test cases from sports, investments, crime, weather, entertainment and politics, 1464 students were involved as subjects. Generally speaking, the research demonstrates that familiar events are deemed more likely to occur, yet when probabilities are assigned to such events, they are low probabilities. Secondly, belief reversals appear to be real- people judge familiar events as more likely to occur vs. unfamiliar events, and they judge the familiar events as more likely NOT to occur vs. unfamiliar events.
6) The article would appeal to both academics and practitioners interested in decision-making. Academics might find it useful in terms of providing insight into further areas of research. Similarly, practitioners might utilize the information presented in this study to better understand the nature of the relationship between themselves and clients.
7) I am currently working on a paper with similar theoretical concerns as this. Furthermore, my dissertation will likely include this subject matter as it relates to the investment decision-making process.