Related Experiment Video
Updated: Jun 9, 2025
06:18
The Collective Trust Game: An Online Group Adaptation of the Trust Game Based on the HoneyComb Paradigm
Published on: October 20, 2022
2.0K
Trust Dynamics in Financial Decision Making: Behavioral Responses to AI and Human Expert Advice Following Structural
Hyo Young Kim1, Young Soo Park2
1Department of Artificial Intelligence, Tech University of Korea, 237 Sangidaehak-ro, Siheung-si 15073, Republic of Korea.
Behavioral Sciences (Basel, Switzerland)
|October 26, 2024
Summary
Trust in financial forecasting AI and human experts decreases after market structural breaks. Level shifts impact trust more than outliers, with human experts experiencing a greater decline than AI systems.
Area of Science:
- Behavioral Economics
- Artificial Intelligence Ethics
- Financial Markets
Background:
- Understanding trust in AI vs. human experts is crucial for decision-making.
- Market structural breaks introduce uncertainty, challenging existing trust dynamics.
- Theoretical frameworks like attribution theory and algorithm aversion inform psychological responses.
Purpose of the Study:
- To compare trust in AI and human experts during financial forecasting under market structural changes.
- To investigate the differential impact of Additive Outliers and Level Shifts on trust.
- To analyze psychological responses to AI and human advice amidst uncertainty.
Main Methods:
- A controlled online experiment with 157 participants recruited via Amazon Mechanical Turk (MTurk).
- Participants forecasted stock prices, randomly assigned to AI or human expert conditions.
- Exposure to different structural break scenarios (Additive Outliers vs. Level Shifts).
Main Results:
- Initial trust levels in AI and human experts were comparable.
- Credibility of advice was more severely compromised by Level Shifts than Additive Outliers.
- Trust decline was more pronounced for human experts compared to AI following structural breaks.
Conclusions:
- Market structural breaks significantly impact trust in forecasting advice.
- Level shifts erode trust more than single anomalies, particularly for human experts.
- Findings offer insights into behavioral responses to AI and human systems in uncertain financial environments.
More Related Videos
08:24The Joint Effect of Social Comparison and Social Distance on Evaluation of Intertemporal Choice Outcomes in Event-related Potential Studies
Published on: August 25, 2023
642
11:51Combining Behavioral Endocrinology and Experimental Economics: Testosterone and Social Decision Making
Published on: March 2, 2011
15.1K
Related Concept Videos
01:25The Anchoring-and-Adjustment Heuristic
7.2K
In order to make good decisions, we use our knowledge and our reasoning. Often, this knowledge and reasoning is sound and solid. However, sometimes, we are swayed by biases or by others manipulating a situation. For example, let’s say you and three friends wanted to rent a house and had a combined target budget of $1,600. The realtor shows you only very run-down houses for $1,600 and then shows you a very nice house for $2,000. Might you ask each person to pay more in rent to get the...
7.2K
01:37Reason and Intuition
6.4K
The human brain processes information for decision-making using one of two routes: an intuitive system and a rational system (Epstein, 1994; popularized by Kahneman, 2011 as System 1 and System 2, respectively). The intuitive system is quick, impulsive, and operates with minimal effort, relying on emotions or habits to provide cues for what to do next, while the rational system is logical, analytical, deliberate, and methodical. Research in neuropsychology suggests that the...
6.4K
00:52Social Proof
27.6K
Social proof is a form of persuasion based on comparison and conformity. People compare their behavior and actions to what others are doing and will change to conform to do what their peers do.
27.6K
01:20Decision Making
93
Decision-making is a fundamental cognitive process that involves evaluating alternatives and selecting among them. This process can range from simple choices, such as deciding what to wear, to complex decisions, like choosing a major in college or a career path. The complexity of the decision often dictates the approach we use, which can be broadly categorized into two types: automatic and controlled decision-making.
Automatic decision-making is fast, intuitive, and relies on gut feelings...
Automatic decision-making is fast, intuitive, and relies on gut feelings...
93
01:14Fundamental Attribution Error
12.8K
According to some social psychologists, people tend to overemphasize internal factors as explanations—or attributions—for the behavior of other people. They tend to assume that the behavior of another person is a trait of that person, and to underestimate the power of the situation on the behavior of others. They tend to fail to recognize when the behavior of another is due to situational variables, and thus to the person’s state. This erroneous assumption is...
12.8K
01:34Groupthink
44.2K
When in group settings, we are often influenced by the thoughts, feelings, and behaviors around us. Groupthink is another phenomenon of conformity where modification of the opinions of members in a group aligns with what they believe is the group consensus (Janis, 1972). In such situations, the group often takes action that individuals would not perform outside the group setting because groups make more extreme decisions than individuals do. Moreover, groupthink can hinder opposing trains of...
44.2K