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When Good Advice is Ignored: The Role of Envy and Stubbornness

Author

Listed:
  • Ronayne, David
  • Sgroi, Daniel
Abstract
We present results from an experiment involving 1,500 participants on whether, when and why good advice is ignored, focusing on envy and stubbornness. Participants performance in skill-based and luck-based tasks generated a probability of winning a bonus. About a quarter ignored advice that would have increased their chance of winning. Good advice was followed less often when the adviser was relatively highly remunerated or the task was skill-based. More envious advisees took good advice more often in the skill-based task, but higher adviser remuneration significantly reduced this effect. Susceptibility to the sunk cost fallacy reduced the uptake of good advice.

Suggested Citation

  • Ronayne, David & Sgroi, Daniel, 2018. "When Good Advice is Ignored: The Role of Envy and Stubbornness," Economic Research Papers 269082, University of Warwick - Department of Economics.
    • Handle: RePEc:ags:uwarer:269082
    DOI: 10.22004/ag.econ.269082
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    More about this item

    Keywords

    Financial Economics;

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • C99 - Mathematical and Quantitative Methods - - Design of Experiments - - - Other
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making

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