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The Impact of Age and Cognitive Style on E-Commerce Decisions: The Role of Cognitive Bias Susceptibility

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Abstract

The aging associated declines in cognitive abilities could render older adults more susceptible to cognitive biases that are detrimental to their e-commerce decisions’ quality. Additionally, certain cognitive styles can lead online consumers to rely on decision heuristics which makes them less meticulous and more prone to bias. In this research-in-progress paper we introduce cognitive bias susceptibility as a potential mediator between age and cognitive style on one end, and decisional outcomes on the other. An experimental design to validate our proposed model is outlined. Both psychometric and eye-tracking methodologies are utilized to achieve a more holistic understanding of the relationships in the proposed model. Potential contributions and implications for future research are outlined.

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... With a wide variety of products and offerings available on the internet, too much choice tends to lead to decision fatigue, a mental state of fatigue causing decreased judgment and satisfaction [6], [1]. This effect is compounded by cognitive biases, including choice overload, anchoring, and confirmation bias, which skew rational choice and lower consumer satisfaction overall [9][12] [13] [14] [16]. For example, El Shamy and Hassanein [9] emphasized the ways in which age and cognitive styles affect users' vulnerability to cognitive biases in e-commerce environments. ...
... This effect is compounded by cognitive biases, including choice overload, anchoring, and confirmation bias, which skew rational choice and lower consumer satisfaction overall [9][12] [13] [14] [16]. For example, El Shamy and Hassanein [9] emphasized the ways in which age and cognitive styles affect users' vulnerability to cognitive biases in e-commerce environments. Likewise, Moser et al. [6] refute the traditional choice overload assumption by presenting evidence that, in some contexts, users may not necessarily have negative consequences because of being exposed to too many choices. ...
... Too many options for products lead to choose overload, reducing the quality of the decision and the satisfaction of consumers [6]. Additionally, both age and cognitive style affect the susceptibility to bias, with user segments having higher tendencies for indecision and error [9]. ...
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... Deeper adaptation of existing e-commerce systems to the needs and limitations of older adults has only recently been considered. El Shamy et al. [8] proposed an experiment to measure the impact of recommender systems and comparison matrices on older adults' e-commerce decisions' quality, but no final results have been published yet. Paw lowska et al. [24] used multi-agent simulation to verify the existence of harmful feedback loop in typical recommendation algorithms, if used by older adults with cognitive limitations. ...
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As the workforce ages rapidly in industrialized countries, a phenomenon known as the graying of the workforce, new challenges arise for firms as they have to juggle this dramatic demographical change (Trend 1) in conjunction with the proliferation of increasingly modern information and communication technologies (ICTs) (Trend 2). Although these two important workplace trends are pervasive, their interdependencies have remained largely unexplored. While Information Systems (IS) research has established the pertinence of age to IS phenomena from an empirical perspective, it has tended to model the concept merely as a control variable with limited understanding of its conceptual nature. In fact, even the few IS studies that used the concept of age as a substantive variable have mostly relied on stereotypical accounts alone to justify their age-related hypotheses. Further, most of these studies have examined the role of age in the same phenomenon (i.e., initial adoption of ICTs), implying a marked lack of diversity with respect to the phenomena under investigation. Overall, IS research has yielded only limited insight into the role of age in phenomena involving ICTs. In this essay, we argue for the importance of studying age-related impacts more carefully and across various IS phenomena, and we enable such research by providing a research agenda that IS scholars can use. In doing so, we hope that future research will further both our empirical and conceptual understanding of the managerial challenges arising from the interplay of a graying workforce and rapidly evolving ICTs.
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The use of the Internet by older adults is growing at a substantial rate. They are becoming an increasingly important potential market for electronic commerce. However, previous researchers and practitioners have focused mainly on the youth market and paid less attention to issues related to the online behaviors of older consumers. To bridge the gap, the purpose of this study is to increase a better understanding of the drivers and barriers affecting older consumers’ intention to shop online. To this end, this study is developed by integrating the Unified Theory of Acceptance and Use of Technology (UTAUT) and innovation resistance theory. By comparing younger consumers with their older counterparts, in terms of gender the findings indicate that the major factors driving older adults toward online shopping are performance expectation and social influence which is the same with younger. On the other hand, the major barriers include value, risk, and tradition which is different from younger. Consequently, it is notable that older adults show no gender differences in regards to the drivers and barriers.
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Consumers often face emotion-laden choices involving conflicting goals of personal importance (e.g., safety). Research suggests that consumers cope with the negative emotion associated with these choices by avoiding certain behaviors, in particular attribute trade-off making. This research investigates a factor that moderates these coping effects. Four experiments show that simple cognitive load can make consumers less averse to making attribute trade-offs. This research demonstrates, counterintuitively, that a reduction of cognitive resources through increased load can result in more normative decision behavior. Load apparently disinhibits trade-off making by disrupting consumers' abilities to consider relevant self goal information and the negative emotional consequences of trading off something of personal importance, thereby reducing consumers' need to cope.
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Three studies suggest that individuals see the existence and operation of cognitive and motivational biases much more in others than in themselves. Study 1 provides evidence from three surveys that people rate themselves as less subject to various biases than the “average American,” classmates in a seminar, and fellow airport travelers. Data from the third survey further suggest that such claims arise from the interplay among availability biases and self-enhancement motives. Participants in one follow-up study who showed the better-than-average bias insisted that their self-assessments were accurate and objective even after reading a description of how they could have been affected by the relevant bias. Participants in a final study reported their peer’s self-serving attributions regarding test performance to be biased but their own similarly self-serving attributions to be free of bias. The relevance of these phenomena to naïve realism and to conflict, misunderstanding, and dispute resolution is discussed.
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Introduction, 99. — I. Some general features of rational choice, 100.— II. The essential simplifications, 103. — III. Existence and uniqueness of solutions, 111. — IV. Further comments on dynamics, 113. — V. Conclusion, 114. — Appendix, 115.
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Older adults need to maintain strong decision-making capabilities as they age. However, we know little about how age-related physical and psychological changes affect older adults' judgment and decision processes. This paper reports the results of research comparing older versus younger adults' performance on evaluation and choice tasks about health-plan options. In particular, comprehension and consistency in judgments (across separate versus joint evaluation contexts) were examined. Results indicated that increasing age was related to greater comprehension errors and inconsistent preferences, even when covariates (education, income, gender, self-perceived skill and health, decision style, and attitude toward delegation) were taken into account. Discussion of the results emphasizes difficulties in interpreting the meaning of age differences in performance on decision tasks and the need for research that ascertains the seriousness of the consequences of age differences in real-life tasks. The implications for providing decision-aiding interventions for older adults are highlighted. Copyright © 2002 John Wiley & Sons, Ltd.
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Consumers use a variety of decision-making styles. This paper conceptualizes eight basic characteristics of these styles and develops a Consumer Styles Inventory to measure them empirically. Factor analysis of the Consumer Styles Inventory validates these eight consumer characteristics. A valid and reliable method for presenting a Profile of Consumer Style, based on measures of the eight style characteristics, is described. Unique findings of the research are discussed, and applications of the Consumer Styles Inventory in consumer education, consumer research, and family financial counseling are suggested.
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Research has recently focused on the effort-reduction or minimization role of computerized decision aids, and how users may employ aids to manage their effort, which in turn affects their choice of decision strategies. In this paper, it is argued that consideration of effort reduction or minimization by itself is not sufficient for inducing changes in decision strategy. Instead, decision aid effects on effort must be considered jointly with the decision quality associated with the various decision strategies. This is true even if the decision aid has no effect on decision quality. We adapt and extend a theoretical framework that can be used to evaluate the joint effects of effort and quality on decision strategy choice. In addition, we reinterpret past research results in light of the framework and present new experimental evidence on the descriptive validity of the framework.
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Almost 1000 adults participated in the development of the Cognitive Style Index (CSI), a new measure designed specifically for use with managerial and professional groups. the objectives of the study were, first, to produce a psychome-trically sound instrument suitable for application in large-scale organizational studies, and second, through its development, to confirm empirically the generic intuition-analysis dimension of cognitive style. Findings suggest that each objective was largely fulfilled. At a time when there is a burgeoning interest in intuition as a basis for decision making and problem solving in organizations, the CSI would appear to be a notable addition to the small collection of measures appropriate for survey research.
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Despite the explosive growth of electronic commerce and the rapidly increasing number of consumers who use interactive media (such as the World Wide Web) for prepurchase information search and online shopping, very little is known about how consumers make purchase decisions in such settings. A unique characteristic of online shopping environments is that they allow vendors to create retail interfaces with highly interactive features. One desirable form of interactivity from a consumer perspective is the implementation of sophisticated tools to assist shoppers in their purchase decisions by customizing the electronic shopping environment to their individual preferences. The availability of such tools, which we refer to as interactive decision aids for consumers, may lead to a transformation of the way in which shoppers search for product information and make purchase decisions. The primary objective of this paper is to investigate the nature of the effects that interactive decision aids may have on consumer decision making in online shopping environments. While making purchase decisions, consumers are often unable to evaluate all available alternatives in great depth and, thus, tend to use two-stage processes to reach their decisions. At the first stage, consumers typically screen a large set of available products and identify a subset of the most promising alternatives. Subsequently, they evaluate the latter in more depth, perform relative comparisons across products on important attributes, and make a purchase decision. Given the different tasks to be performed in such a two-stage process, interactive tools that provide support to consumers in the following respects are particularly valuable: (1) the initial screening of available products to determine which ones are worth considering further, and (2) the in-depth comparison of selected products before making the actual purchase decision. This paper examines the effects of two decision aids, each designed to assist consumers in performing one of the above tasks, on purchase decision making in an online store. The first interactive tool, a recommendation agent (RA), allows consumers to more efficiently screen the (potentially very large) set of alternatives available in an online shopping environment. Based on self-explicated information about a consumer's own utility function (attribute importance weights and minimum acceptable attribute levels), the RA generates a personalized list of recommended alternatives. The second decision aid, a comparison matrix (CM), is designed to help consumers make in-depth comparisons among selected alternatives. The CM allows consumers to organize attribute information about multiple products in an alternatives × attributes matrix and to have alternatives sorted by any attribute. Based on theoretical and empirical work in marketing, judgment and decision making, psychology, and decision support systems, we develop a set of hypotheses pertaining to the effects of these two decision aids on various aspects of consumer decision making. In particular, we focus on how use of the RA and CM affects consumers' search for product information, the size and quality of their consideration sets, and the quality of their purchase decisions in an online shopping environment. A controlled experiment using a simulated online store was conducted to test the hypotheses. The results indicate that both interactive decision aids have a substantial impact on consumer decision making. As predicted, use of the RA reduces consumers' search effort for product information, decreases the size but increases the quality of their consideration sets, and improves the quality of their purchase decisions. Use of the CM also leads to a decrease in the size but an increase in the quality of consumers' consideration sets, and has a favorable effect on some indicators of decision quality. In sum, our findings suggest that interactive tools designed to assist consumers in the initial screening of available alternatives and to facilitate in-depth comparisons among selected alternatives in an online shopping environment may have strong favorable effects on both the quality and the efficiency of purchase decisions—shoppers can make much better decisions while expending substantially less effort. This suggests that interactive decision aids have the potential to drastically transform the way in which consumers search for product information and make purchase decisions.
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This exploratory research investigates the nature of explanation use and factors that influence it during users' interaction with a knowledge-based system (KBS) for decision-making. It draws upon several cognitive perspectives to help understand when, why, and how explanations are used. A verbal protocol analysis was conducted based on a laboratory experiment involving a KBS for financial analysis. Major categories of explanation use were identified, and accounted for with relevant cognitive perspectives. Results show that explanations were requested to deal with comprehension difficulties caused by various types of perceived anomalies in KBS output. There were qualitative and quantitative differences in the nature and extent of explanation use between novices and experienced professionals. These results offer new insights to why explanations are useful and important, what factors influence explanation use, and what information should be included in explanations.
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The purpose of this study was to explore the relations between individual decision-making styles as measured by the General Decision-making Style (GDMS) test, developed by Scott and Bruce (1995), and some mental abilities theoretically related to decision-making. Participants were 206 Swedish military officers from all services. The multiple regression analysis showed that the Rational, Dependent and Avoidant, but not the Intuitive and Spontaneous decision-making styles could be partly predicted from scores on the Self-esteem Scales (Forsman & Johnson, 1996) and from scores on the Action Control Scales (Kuhl, 1994). The result indicates that decision-making style is not only reflective of habits and thinking practices as proposed in earlier research. Decision-making style also involves basic self-evaluation and the general ability to initiate and maintain intentions (i.e. self-regulation). This calls for a wider definition of the term decision-making style, a holistic definition that takes the whole individual into consideration.
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With the proliferation of Internet-based applications for collaborative work such as group decision support system (GDSS), traditional face-to-face (FTF) interactions are being augmented or replaced by screen-to-face (STF) technology. Extant research results find that some individuals prefer FTF mode for interaction and would feel frustrated under an STF mode, but others may feel very comfortable using electronic STF applications. This paper evaluates the influence of cognitive style on the perception of individuals negotiating over FTF or STF communication modes. Cognitive style explains how individuals prefer to receive information and what methods they use to process that information. The results suggest that when individuals are faced with a mixed-motive negotiation task, some cognitive styles mitigate the effects of communication modes while other cognitive styles are not sensitive to it. Hence, cognitive style and communication modes have interaction effects.
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This paper integrates a number of strands of a long-term project that is critically analysing the academic field of decision support systems (DSS). The project is based on the content analysis of 1093 DSS articles published in 14 major journals from 1990 to 2004. An examination of the findings of each part of the project yields eight key issues that the DSS field should address for it to continue to play an important part in information systems scholarship. These eight issues are: the relevance of DSS research, DSS research methods and paradigms, the judgement and decision-making theoretical foundations of DSS research, the role of the IT artifact in DSS research, the funding of DSS research, inertia and conservatism of DSS research agendas, DSS exposure in general “A” journals, and discipline coherence. The discussion of each issue is based on the data derived from the article content analysis. A number of suggestions are made for the improvement of DSS research. These relate to case study research, design science, professional relevance, industry funding, theoretical foundations, data warehousing, and business intelligence. The suggestions should help DSS researchers construct high quality research agendas that are relevant and rigorous.
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In the context of online comparison shopping, the phenomenon of order effect and its impact has profound theoretical and practical significance, as many search engines and shopping portals offer paid placement and paid inclusion in search results. In this study, we investigate how order effects and other market competitive factors work together to attract consumers’ attention to online vendors, which is manifested by the time spent on collecting more vendor information, and the probability of a vendor being included in a consumer’s consideration set. We found that the effect of serial position of a vendor in a list is mediated by consumers’ attention which in turn affects the probability of the vendor being accepted.
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As the populations of most of the world’s developed nations experience an increase in average age, a similar trend is being observed in the population of computer and Internet users. In many cases, older adults are the fastest growing computer and Internet user group in both personal and workplace contexts. However, the needs and concerns of older adults as computer users differ from those of younger users as a result of the natural changes associated with the aging process. Much research has been conducted in a variety of fields in order to understand how these changes experienced by older adults impact their use of computers and the Internet. This article reviews this existing research and provides a holistic view of the field. Since the study of computer use by older adults is a multi-disciplinary topic by nature, we provide a synthesis of the findings across these many disciplines, and attempt to highlight any gaps that exist. We use Social Cognitive Theory as a lens to view and organize the literature, as well as illustrate means through which computer use by this user group can be encouraged. Finally, suggestions for future research are proposed, and implications for research and practice are discussed.
Article
This paper presents design science research that aims to improve decision support systems (DSS) development in organizations. Evolutionary development has been central to DSS theory and practice for decades, but a significant problem for DSS analysts remains how to conceptualize the improvement of a decision task during evolutionary DSS development. The objective of a DSS project is to improve the decision process and outcome for a manager making an important decision. The DSS analyst needs to have a clear idea of the nature of the target decision task and a clear strategy of how to support the decision process. Existing psychological research was examined for help with the conceptualization problem, and the theory of cognitive bias is proposed as a candidate for this assistance. A taxonomy of 37 cognitive biases that codifies a complex area of psychological research is developed. The core of the project involves the construction of a design artefact – an evolutionary DSS development methodology that uses cognitive bias theory as a focusing construct, especially in its analysis cycles. The methodology is the major contribution of the project. The feasibility and effectiveness of the development methodology are evaluated in a participatory case study of a strategic DSS project where a managing director is supported in a decision about whether to close a division of a company.
Article
The traditional assumption in the decision support systems (DSS) literature is that if decision makers are provided with expanded processing capabilities they will use them to analyze problems in more depth and, as a result, make better decisions. Empirical studies investigating the relationship between DSS and decision quality have not borne this out. The explanation for such outcomes could be found in behavioral decision-making theories. The literature on behavioral decision making indicates that the conservation of effort may be more important than increased decision quality in some cases. If ths is so, then the use of a decision aid may result in effort savings but not improved decision performance. The two experiments reported here use verbal protocol analysis to compare the extent of information use by unaided decision makers and users of a decision aid designed to support preferential choice problems. The results of the two studies indicate that subjects with a decision aid did not use more information than those without one. Overall, subjects behaved as if effort minimization was an important consideration. For DSS researchers these studies indicate that to understand the DSS-decision quality relationship, it is necessary to consider the decision maker's tradeoff between improving decision quality and conserving effort. For DSS designers these results imply a need to focus on the moderating role that effort will play in determining DSS effectiveness.
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This article described three heuristics that are employed in making judgements under uncertainty: (i) representativeness, which is usually employed when people are asked to judge the probability that an object or event A belongs to class or process B; (ii) availability of instances or scenarios, which is often employed when people are asked to assess the frequency of a class or the plausibility of a particular development; and (iii) adjustment from an anchor, which is usually employed in numerical prediction when a relevant value is available. These heuristics are highly economical and usually effective, but they lead to systematic and predictable errors. A better understanding of these heuristics and of the biases to which they lead could improve judgements and decisions in situations of uncertainty.