Decision fatigue and heuristic analyst forecasts

• 成果类型: Article
• 署名作者: Hirshleifer, David; Levi, Yaron; Lourie, Ben; Teoh, Siew Hong
• 署名单位: University of California System; University of California Irvine; University of Southern California
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2019.01.005
• 发表日期: 2019
• 页码: 83-98
• 关键词: Analysts; decision fatigue; Heuristic; behavioral finance

摘要

Psychological evidence indicates that decision quality declines after an extensive session of decision-making, a phenomenon known as decision fatigue. We study whether decision fatigue affects analysts' judgments. Analysts cover multiple firms and often issue several forecasts in a single day. We find that forecast accuracy declines over the course of a day as the number of forecasts the analyst has already issued increases. Also consistent with decision fatigue, we find that the more forecasts an analyst issues, the higher the likelihood the analyst resorts to more heuristic decisions by herding more closely with the consensus forecast, self-herding (i.e., reissuing their own previous outstanding forecasts), and issuing a rounded forecast. Finally, we find that the stock market understands these effects and discounts for analyst decision fatigue. (C) 2019 Elsevier B.V. All rights reserved.