Dissertation
The Impact of Culture on Decision-Making Outcomes: A Behavioural Economics Approach
University of the Sunshine Coast, Queensland
Doctor of Philosophy, University of the Sunshine Coast, Queensland
2022
DOI:
https://doi.org/10.25907/00134
Abstract
In our globalised world with international and intercultural decision processes, supply chains and customer relations, our proneness to biases and heuristics represents a considerable threat to efficient decision-making. The relatively less studied influence of culture on the susceptibility to concepts of behavioural economics and behavioural finance is the key matter of this research. To explore the latter, 837 people from Australia, China, Germany and the United States participated in nine decision-making experiments with different conditions in four studies. These experiments were based on three concepts of behavioural economics and behavioural finance: the lure of choice, mental accounting, and overconfidence. Based on data collected from Australia, China, Germany, and the United States, the research presented in this thesis addresses the issue of detectable and significant differences in susceptibility to the lure of choice, mental accounting, and overconfidence.
The analysis was conducted at the individual level, where answers from participants of all cultural backgrounds were considered simultaneously. Country-level data was examined separately for each of the four cultural backgrounds. ANOVA and logistic regression analysis as a robustness check were applied. The findings indicate significant differences in susceptibility to the biases and heuristics mentioned above, which can be explained by cultural traits and socio-demographic factors.
At the individual level, higher power distance was associated with lower lure-of choice behaviour. Moreover, nationality and job were found to influence mental accounting behaviour. Higher age was related to lower degrees of mental accounting. High power distance and more years of formal school education were associated with lower levels of observable overconfidence, and nationality significantly affected overconfidence behaviour.
At the country level, higher index values for masculinity were associated with lower levels of lure-of-choice behaviour in the Chinese sample. More years of formal school education in the German sample and higher index values of power distance in the US sample led to reduced lure-of-choice behaviour. For mental accounting, higher age was associated with lower levels of mental accounting in the German sample. More years of school education were associated with lower overconfidence behaviour in German participants, while high index values of power distance were related to lower levels of overconfidence in the US participants. However, high index values of masculinity led to increasing overconfidence behaviour in the US sample.
The results contribute to the body of knowledge on the influencing factors of decision-making and the deeper exploration of concepts of behavioural economics and behavioural finance. It is expected that the findings will be applicable not only in international and intercultural organisations but also in fields such as marketing and human resources and in personal (financial) decision-making contexts.
Details
- Title
- The Impact of Culture on Decision-Making Outcomes: A Behavioural Economics Approach
- Authors
- Sebastian Hoffmann - University of the Sunshine Coast, Queensland, School of Business and Creative Industries
- Contributors
- Sajid Anwar (Supervisor) - University of the Sunshine Coast, Queensland, Indigenous and Transcultural Research Centre - Legacy
- Awarding institution
- University of the Sunshine Coast, Queensland
- Degree awarded
- Doctor of Philosophy
- Publisher
- University of the Sunshine Coast, Queensland
- DOI
- 10.25907/00134
- Organisation Unit
- School of Business and Creative Industries; Indigenous and Transcultural Research Centre; University of the Sunshine Coast, Queensland
- Language
- English
- Record Identifier
- 99619708402621
- Output Type
- Dissertation
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