Journal article
Testing the Rational Decision-Making Model Through an Outsourcing Task
Journal of Applied Management Accounting Research, Vol.11(2), pp.63-78
2013
Abstract
Previous research on financial decision-making situations indicated that contextual aspects of financial information, such as framing, problem space and asset specificity influence the outcome. To assess the influence of these factors, an outsourcing task was used to survey the perceptions of accountants. The survey examined the effect of framing (positive/negative) with the inclusion of sunk and opportunity cost information across the decision task. The respondents were also presented with information regarding asset specificity - the extent to which assets are inexorably tied to the specific project or outsourcing agreement. In making the decision to outsource, the sunk cost effect, framing and asset specificity were found to be significant factors in influencing the decision outcome. The results however, were not fully consistent with the predictions of prospect theory in particular a reverse effect was found- in the negative frame, greater risk-avoidance was evident while in the positive frame, greater risk-taking was evident
Details
- Title
- Testing the Rational Decision-Making Model Through an Outsourcing Task
- Authors
- Gregory Laing (Author) - University of the Sunshine Coast - Faculty of Arts and Business
- Publication details
- Journal of Applied Management Accounting Research, Vol.11(2), pp.63-78
- Publisher
- Institute of Certified Management Accountants
- Date published
- 2013
- ISSN
- 1443-9905
- Copyright note
- Copyright © 2013 Institute of Certified Management Accountants. Reproduced with permission of the copyright holder.
- Organisation Unit
- University of the Sunshine Coast, Queensland
- Language
- English
- Record Identifier
- 99449039102621
- Output Type
- Journal article
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