Behavioral Economics in Information Systems Research: A Persuasion Context Analysis

Oduor, Michael; Oinas-Kukkonen, Harri

doi:10.5220/0006277700170028

Cited by 3 publications

(9 citation statements)

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“…Second, most of the information system studies using BE analyse the bias or debias of decision makers (firms in this study) (George, Duffy, & Ahuja, 2000;Oduor & Oinas-Kukkonen, 2017). However, this study shows that BE, which models agents, can improve the accuracy of predictions about their behaviour.…”

Section: Contributions and Limitationsmentioning

confidence: 71%

“…Finally, our research bridges DSSs in information systems and the PER in BE. Recently, several studies have stressed the importance of considering BE for DSSs from an economic perspective (Oduor & Oinas-Kukkonen, 2017;Arnott & Gao, 2019). To the best of our knowledge, our study is the first to connect CBDT in DSS and the PER in BE, although many concepts in BE have been introduced into DSS.…”

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confidence: 97%

“…Behavioural economics (BE) attempts to clarify the mechanisms behind human behaviour. The use of BE in information systems has gradually become important in policy and corporate strategies (Arnott & Gao, 2019;Oduor & Oinas-Kukkonen, 2017). Arnott and Gao (2019) have stressed that the decision-making theories of BE have a long history in decision support system (DSS) research, although the use of BE has been relatively modest.…”

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confidence: 99%

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Applying the peak‐end rule to decision‐making regarding similar products: A case‐based decision approach

Kinjo

Ebina

2021

Expert Systems

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This study proposes a marketing decision support system (DSS) for firms using casebased and peak-end approaches to model consumers. The proposed DSS is composed of model and estimation methods. We employ a similarity function used in case-based decision theory to examine the degree of similarity between the past and current products offered to a consumer. The contributions of this study are as follows: First, by extending the peak-end approach, the proposed model could be utilized to analyse not only the same product but also multiple similar products. The DSS could be applied to a broad range of decision problems. Second, by extending the case-based decision model, our DSS considerably reduces the number of computational operations needed. Third, the model demonstrated the best fit among the compared models and possessed high prediction accuracy when analysing the viewing data for Japanese television dramas. The DSS could increase the future purchase probability of a product. Our research bridges two significant concepts: case-based decision models in DSSs and peak-end rules in behavioural economics.case-based decision theory, marketing decision support system, peak-end rule, TV drama | INTRODUCTIONPeople in the real world determine their behaviour by adopting heuristics and biases. Behavioural economics (BE) attempts to clarify the mechanisms behind human behaviour. The use of BE in information systems has gradually become important in policy and corporate strategies (Arnott & Gao, 2019;Oduor & Oinas-Kukkonen, 2017). Arnott and Gao (2019) have stressed that the decision-making theories of BE have a long history in decision support system (DSS) research, although the use of BE has been relatively modest. Kahneman, Fredrickson, Schreiber and Redelmeier (1993) have proposed a key human decision-making concept in BE called the peak-end rule (PER) (Kahneman et al., 1993). Formally, the rule is defined as follows: the global retrospective rating is well predicted by the average of the levels of pain reported at the worst moment of the experience and at its end (Kahneman, 2011;Kahneman et al., 1993). PER states that noteworthy assessments of an event in the past and immediately before it ends considerably influence an individual's overall evaluation (Cojuharenco & Ryvkin, 2008). The PER becomes more significant when considering human behaviours in many fields, such as economics, marketing and psychology.In recent years, the PER has been applied for marketing DSSs in studies wherein the prices of the same product (referred to as "problems" in this article) during previous peaks and ends are examined. After instantaneous evaluations are performed, the PER is applied to consumer decision-making to determine the optimal price and marketing strategy for the firm both theoretically and empirically (Nasiry & Popescu, 2011).However, consumers (referred to as "agents" in this article) have the opportunity to choose not only the same product repeatedly but also similar products in the same category. For example, when deciding w...

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Section: Contributions and Limitationsmentioning

confidence: 71%

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confidence: 97%

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confidence: 99%

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Applying the peak‐end rule to decision‐making regarding similar products: A case‐based decision approach

Kinjo

Ebina

2021

Expert Systems

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“…Goes (2013) in an MIS Quarterly editorial echoed these calls. There have been two reviews of BE in IS research that indicated that BE as a reference discipline has a low use in IS research (Fleischmann et al, 2014; Odnor and Oinas-Kukkonen, 2017). Most recently, Arnott and Gao (2019) provided an overview of BE and suggested 10 areas where BE could be used more widely in DSS projects.…”

Section: Introductionmentioning

confidence: 99%

Behavioral economics in information systems research: Critical analysis and research strategies

Arnott

Gao

2021

Journal of Information Technology

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Theories of decision-making have long been important foundations for information systems (IS) research and much of IS is concerned with information processing for decision making. The discipline of behavioral economics (BE) provides the dominant contemporary approach for understanding human decision-making. Therefore, it is logical that IS research that involves decision making should consider BE as foundation or reference theory. Surprisingly, and despite calls for greater use of BE in IS research, it seems that IS has been slow to adopt contemporary BE as reference theory. This paper reports a critical analysis of BE in all fields of IS based on an intensive investigation of quality IS research using bibliometric content analysis. The analysis shows that IS researchers have a general understanding of BE, but their use of the theories has an ad hoc feel where only a narrow range of BE concepts and theories tend to form the foundation of IS research. The factors constraining the adoption of BE theories in IS are discussed and strategies for the use of this influential foundation theory are proposed. Guidance is provided on how BE could be used in various aspects of IS. The paper concludes with the view that BE reference theory has the potential to transform significant areas of IS research.

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“…The present study, an extension of Oduor & Oinas-Kukkonen [6], analyzes behavioral economics in information systems (IS) research by using persuasion context analysis as described in [7]. Applying behavioral economics methods to study the use and adoption of digital interventions can be a potential avenue for better understanding users' requirements, how users interact with technology and the factors that hinder their adoption and/or use.…”

Section: Introductionmentioning

confidence: 99%

Behavioral Economics Through the Lens of Persuasion Context Analysis: A Review of Contributions in Leading Information Systems Journals

Oduor

Oinas-Kukkonen

2018

Enterprise Information Systems

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As technology becomes an integral part of our everyday lives, the more crucial it is to investigate how it can be further harnessed to improve individuals' wellbeing. This involves studying users' interactions with technology, how different design techniques influence their use, and the factors that might lead to sub-optimal use of technology. Such factors include decision biases which are mostly investigated in behavioral economics research. Behavioral economics counters the arguments of standard economic theories and combines psychological theories and economics to study how people actually behave as opposed to how they should behave as rational beings. Thus, this review provides an overview of behavioral economics research in the major IS journals. The aim is to determine the extent of such research within the IS field. An electronic search of the major IS journals was conducted over an 8-year period and the findings were categorized according to the use, user and technology contexts of the persuasive systems design model. The findings reveal the need for awareness of how various behavioral economic principles (or decision biases) influence decision making in technology-mediated settings and the development of strategies to mitigate their influence.

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Behavioral Economics in Information Systems Research: A Persuasion Context Analysis

Cited by 3 publications

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Applying the peak‐end rule to decision‐making regarding similar products: A case‐based decision approach

Applying the peak‐end rule to decision‐making regarding similar products: A case‐based decision approach

Behavioral economics in information systems research: Critical analysis and research strategies

Behavioral Economics Through the Lens of Persuasion Context Analysis: A Review of Contributions in Leading Information Systems Journals

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