The Effect of Emotional Cues on Making Economic Decisions under Uncertainty

S. Bromuri, Mahdi Ebrahim, Y.D. Iren, P Geelen

Research output: Contribution to conferencePaperAcademic

Abstract

We investigate the understudied role of emotions on investors’ decision. Specifically, we identify six basic human emotions (i.e. happiness, sadness, surprise, fear, anger, and disgust) expressed by S&P 500 CEOs during their earning conference calls and examine their effects on financial analysts’ decisions (i.e. retain, buy or sell shares). To identify CEOs' emotions in more than 500 calls we developed a deep learning algorithm trained by experts annotating vocal data in a subset of calls. Our findings shed light on underlying emotional mechanisms of financial decision-making under uncertainty, thereby contributing to behavioral economic theory.
Original languageEnglish
Publication statusPublished - 6 Nov 2018
EventINFORMS Annual Meeting - Phoenix Convention Center, Sheraton Phoenix Downtown Hotel, Hyatt Regency Phoenix, and Renaissance Phoenix Downtown Hotel, Phoenix, United States
Duration: 4 Nov 20187 Nov 2018
http://meetings2.informs.org/wordpress/phoenix2018/

Conference

ConferenceINFORMS Annual Meeting
CountryUnited States
CityPhoenix
Period4/11/187/11/18
Internet address

Fingerprint

Emotion
Economics
Decision under uncertainty
Chief executive officer
Deep learning
Learning algorithm
Disgust
Surprise
Financial analysts
Conference calls
Happiness
Economic theory
Investors
Financial decision making
Anger
Decision making under uncertainty

Cite this

Bromuri, S., Ebrahim, M., Iren, Y. D., & Geelen, P. (2018). The Effect of Emotional Cues on Making Economic Decisions under Uncertainty. Paper presented at INFORMS Annual Meeting, Phoenix, United States.
Bromuri, S. ; Ebrahim, Mahdi ; Iren, Y.D. ; Geelen, P. / The Effect of Emotional Cues on Making Economic Decisions under Uncertainty. Paper presented at INFORMS Annual Meeting, Phoenix, United States.
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Bromuri, S, Ebrahim, M, Iren, YD & Geelen, P 2018, 'The Effect of Emotional Cues on Making Economic Decisions under Uncertainty' Paper presented at INFORMS Annual Meeting, Phoenix, United States, 4/11/18 - 7/11/18, .

The Effect of Emotional Cues on Making Economic Decisions under Uncertainty. / Bromuri, S.; Ebrahim, Mahdi; Iren, Y.D.; Geelen, P.

2018. Paper presented at INFORMS Annual Meeting, Phoenix, United States.

Research output: Contribution to conferencePaperAcademic

TY - CONF

T1 - The Effect of Emotional Cues on Making Economic Decisions under Uncertainty

AU - Bromuri, S.

AU - Ebrahim, Mahdi

AU - Iren, Y.D.

AU - Geelen, P

PY - 2018/11/6

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N2 - We investigate the understudied role of emotions on investors’ decision. Specifically, we identify six basic human emotions (i.e. happiness, sadness, surprise, fear, anger, and disgust) expressed by S&P 500 CEOs during their earning conference calls and examine their effects on financial analysts’ decisions (i.e. retain, buy or sell shares). To identify CEOs' emotions in more than 500 calls we developed a deep learning algorithm trained by experts annotating vocal data in a subset of calls. Our findings shed light on underlying emotional mechanisms of financial decision-making under uncertainty, thereby contributing to behavioral economic theory.

AB - We investigate the understudied role of emotions on investors’ decision. Specifically, we identify six basic human emotions (i.e. happiness, sadness, surprise, fear, anger, and disgust) expressed by S&P 500 CEOs during their earning conference calls and examine their effects on financial analysts’ decisions (i.e. retain, buy or sell shares). To identify CEOs' emotions in more than 500 calls we developed a deep learning algorithm trained by experts annotating vocal data in a subset of calls. Our findings shed light on underlying emotional mechanisms of financial decision-making under uncertainty, thereby contributing to behavioral economic theory.

M3 - Paper

ER -

Bromuri S, Ebrahim M, Iren YD, Geelen P. The Effect of Emotional Cues on Making Economic Decisions under Uncertainty. 2018. Paper presented at INFORMS Annual Meeting, Phoenix, United States.