Business Papers

The Influence of Affect on Managers Capital-Budgeting Decisions* THOMAS E. KIDA, University of momma at Amherst KIMBERLY K. MORENO, Virginia Polytechnic Institute and State University JAMES E SMITH, University of mum at Amherst Abstract In this paper, we propose that emotional reactions atomic number 18 integral to chronicle decisiveness contexts like capital budgeting, and that researchers must conjointly occupy affect and cognition to better empathise method of accounting finale makers behavior. We argue that interpersonal relationships argon characteristic of umpteen capital-budgeting contexts, and that these relationships female genital organ pourboire to emotional affective reactions. For example, reactions such as frustration and peevishness may result if a carriage is treated below the belt by another individual concern in a capital project. Drawing on relevant work in neurobiology and psychology, we then predict that these affective reactions can influence managers capital-budgeting decisions. We calculate on four experimental scenarios that try the impact of affective reactions on capital-budgeting decisions. Consistent with our predictions, the results indicate that managers regard both financial data and affective reactions when evaluating the utility of an investiture alternative.

Our results suggest that researchers should consider both affect and cognition to more(prenominal) honesty understand decision making in accounting contexts. Keywords Affective reactions; Capital-budgeting decisions; Investment decision altematives; Managerial decision making Condense Les activites relatives au choix diethylstilboestrol investisseme nts sont determinantes pour le rendement a l! ong terme dune entreprise (Swain et Haka, 2000 ; dark-brown et Solomon, 1993). Les metho stilbesterol traditionnelles de choix des investissements mettent 1accent sur la valeur esperee des differentes options, les gestionnaires analysant les diverses options envisageables pour retenir celle qui offre la valeur attendue la plus elevee. Toutefois, les decisions...If you want to get a full essay, tell it on our website: OrderEssay.net

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