The impact of self‐confidence on the compromise effect

Abstract

This research reports an investigation into whether the personality aspect of self-confidence affects the compromise effect. We hypothesize that highly self-confident people have greater certainty in making decisions and are more attracted to risk-taking, which makes them less likely to choose the safe or middle option in a large choice set. The three studies involved are conducted using between- and within-subjects experimental designs. Various product categories are used to generalize the findings. Study 1 looks at purchasing decisions and utilizes three scales of self-confidence, risk preference, and uncertainty; it demonstrates that consumers with high self-confidence are less likely to choose a compromise option due to high certainty in their decision-making. Study 2 discovers that people with low self-confidence are more likely to choose the middle option in a risky condition than in a nonrisky condition. Study 3 decomposes self-confidence into general and specific self-confidence, and reveals that people with low general self-confidence and low specific self-confidence are more likely to choose the middle option.

Rational application of antibiotics—The influence of anaesthetists’ gender on self‐confidence and knowledge

“…In line with the findings of the present analysis, a study in educational research suggests that other factors than objective knowledge are crucial for self‐confidence . Yet, self‐confidence plays a key role in clinical decision‐making . Nevertheless, perceived preparedness (eg, self‐confidence or self‐rated knowledge) does not guarantee actual preparedness .…”

What Drives Decision Makers to Follow or Ignore Forecasting Tools - A Game Based Analysis

“…If a decision maker believes in his competence, he takes more risky choices because he thinks that he can avoid losses due to his skills [28]. Vice versa, if a decision maker encounters defeats, he loses self-efficacy and self-confidence [28] so that he tends to avoid risky situations [6]. In our case, avoiding a risky situation means to follow the (wrong) forecast.…”

“…Behavioral sciences have emphasized the role of affect [32], emotion [29], self-confidence [6] [28], self-esteem and anxiety [55] for the decision making itself and how these factors influence the choice of risky or more certain alternatives. But the role of individuals using forecasts is hardly investigated and should be put into focus [26] [50].…”

Managerial Creativity: The Roles of Dynamic Capabilities and Risk Preferences

“…Our paper suggests that the risk preferences of managers can predict their creative behaviors. Theorists agree that willingness to take risks supports creativity (Dewett, , , ), and the factors that support risk‐taking also encourage creative behavior (Oldham and Cummings, ; Sanders and Carpenter, ; Chuang et al ., ). Indeed, for strategic decision making, the risk‐taking of managers implies the tendency to select solutions that differ from normal operational practices.…”