The Influence of Information Presentation Order and Evaluation Time Horizon on the Outcome Effect

Advances in Accounting, Vol. 28, No. 2

Posted: 22 Feb 2016

See all articles by Lasse Mertins

Lasse Mertins

Johns Hopkins University - Carey Business School

James H. Long

Auburn University - Raymond J. Harbert College of Business - School of Accountancy

Date Written: 2012

Abstract

The outcome effect occurs when an evaluation is influenced by knowledge of the outcome, even when it is unclear that the outcome provides additional information about the evaluatee's performance. This phenomenon has received considerable attention in the accounting and psychology literatures, which rely on cognitive or motivational factors to account for the outcome effect. However, prior research has not considered the impact of information presentation order or the evaluation time horizon. We evaluate prior research in accounting and conclude that information presentation order could have significantly impacted the outcome effect observed in these studies. We then report the results of an experiment that provides evidence that information presentation order plays a significant role in the existence and magnitude of the outcome effect. In addition, we find that the length of the evaluation time horizon is positively related to the magnitude of the outcome effect when conditions favor a recency effect.

Keywords: outcome effect, performance evaluation, information presentation order, evaluation time horizon, recency

Suggested Citation

Mertins, Lasse and Long, James H., The Influence of Information Presentation Order and Evaluation Time Horizon on the Outcome Effect (2012). Advances in Accounting, Vol. 28, No. 2, Available at SSRN: https://ssrn.com/abstract=2735514

Lasse Mertins (Contact Author)

Johns Hopkins University - Carey Business School ( email )

100 International Drive
Baltimore, MD 21202
United States

James H. Long

Auburn University - Raymond J. Harbert College of Business - School of Accountancy ( email )

301 Lowder Hall
405 West Magnolia Avenue
Auburn University, AL 36849
United States
(334) 844-6214 (Phone)
(334) 844-5875 (Fax)

HOME PAGE: http://jameshlong.com

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