Information evaluation, Information systems, Group decision making, Group performance

Information evaluation problem, Knowledge, Decision making

Information systems, Decision making, Lab experiment

Abstract ABSTRACT: In 1974, the AAA Committee on the Relationship of Behavioral Science and Accounting called for the development of teaching methods that enabled students to experience behavioral aspects of accounting. This article suggests behavioral accounting research as an important source for the development of such teaching methods. As an example, a behavioral decision simulation adapted from prior research is described, The simulation enables the student to experience the information evaluation method and enables him to contrast his subjective evaluation process with the evaluation process prescribed by a normative model. The article illustrates how this contrast can serve as a basis for classroom discussion of human information processing issues in accounting.

Abstract This research tests a normative model of information evaluation as a descriptive representation of information evaluator (IE) behavior in judging the value of alternative information systems. The criterion of predictive ability was the principal basis for performing this test. Several methodological and design features were introduced which permitted a more rigorous test than was possible in previous studies, IEs specified the amount that they would pay for an information system consisting of a single marble drawn from one of two urns containing many black and white marbles. The sample result was provided to a decision maker who decided from which urn the marble was drawn. Five levels of priors, information system accuracy, and three types of decisionmaker models were experimentally manipulated. The results were inconsistent with the predictions of the normative model. Among the alternative representations we tested, IE behavior was best represented by a multiplicative composition of priors, accuracy, and type of decision maker.

Abstract ABSTRACT: This paper reports the results of an experiment to test four models of the principal's information evaluation behavior in a private, pre-decision, principal-agency setting, The four models tested were an expected utility model, a prospect theory model, a linear model and a multiplicative model. In response to recent criticism that tests of positive theories in accounting lack sufficient power to discriminate among competing theories, the tests of the models were designed to disconfirm the models' predictions without assuming initial conditions. The model which best resisted the attempts to falsify it was the multiplicative model. The results demonstrate the generalizability of theories of information evaluation behavior from an information evaluator-decision maker setting to a principal-agency setting and show that the descriptive validity of principal-agency theory can be enhanced by incorporating models of individual behavior other than those based on expected utility theory. The study also provides a rigorous test of prospect theory and offers guidance for the future development of this theory.

[This paper reports the results of an experiment to test four models of the principal's information evaluation behavior in a private, pre-decision, principal-agency setting. The four models tested were an expected utility model, a prospect theory model, a linear model and a multiplicative model. In response to recent criticism that tests of positive theories in accounting lack sufficient power to discriminate among competing theories, the tests of the models were designed to disconfirm the models' predictions without assuming initial conditions. The model which best resisted the attempts to falsify it was the multiplicative model. The results demonstrate the generalizability of theories of information evaluation behavior from an information evaluator-decision maker setting to a principal-agency setting and show that the descriptive validity of principal-agency theory can be enhanced by incorporating models of individual behavior other than those based on expected utility theory. The study also provides a rigorous test of prospect theory and offers guidance for the future development of this theory.]

Abstract Reviews the book "Human Information Processing in Accounting," by Robert H. Ashton.