Choice Reversal in Management Accounting – A Quasi Experimental Demonstration

16 Pages Posted: 7 Nov 2011 Last revised: 11 Apr 2013

Date Written: November 7, 2011


In a quasi-experimental study (n= 53), using a between-subject design, I found evidence that the acquisition of new information, even if it is non-instrumental, frequently leads to choice reversals (in 3 out of 4 cases). As expected, participants (graduate students and accounting professionals) extensively engaged in information acquisitiveness, and often weighted the latest cue most heavily in conducting a typical management accounting task (e.g. fraud detection, investment decision making). This finding is particularly important since information acquisition and evaluation is an activity done by management accountants on a daily basis. Interestingly, the effect is robust both in conditions where the information was free, and where the information was said to be costly. So it appears that the mere existence of new facts lets participants believe that this information had a higher importance compared to the known facts. The theoretical implications and practical relevance of the results are discussed.

Keywords: bounded rationality, JDM in accounting, information processing, behavioral accounting

JEL Classification: M40, M41

Suggested Citation

Basel, Jörn Sebastian, Choice Reversal in Management Accounting – A Quasi Experimental Demonstration (November 7, 2011). Available at SSRN: or

Jörn Sebastian Basel (Contact Author)

Kalaidos Research Zurich ( email )

Jungholzstr. 43
CH-8050 Zurich

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