Search results for: Ambrus Kecskes

Authors: Ali Ahmadi, Ambrus Kecskes, Roni Michaely, Phuong-Anh Nguyen

Abstract:

We quantify the proliferation of artificial intelligence innovation since 1990. Then, studying publicly traded firms, we find that they direct their production of innovation toward AI, motivated by their own and their customers, labor's exposure to AI technology. We instrument actual AI production by interacting with exogenously measured innovation capacity and AI exposure. We find that consistently during the past three decades, producing AI transitorily increases profitability, durably decreases risk (both systematic and idiosyncratic), and increases a firm's future stock returns. We can empirically distinguish the production of AI innovation from AI adoption, automation, and other potential confounds. The results suggest that AI innovation is a firm value increase that is underestimated by investors.

Keywords: artificial intelligence, innovation, technology, labor, firm value, corporate investment, asset pricing

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Authors: Elitza Z. Ambrus, Bjoern Hartig, Ryan McKay

Abstract:

Individuals’ self-judgments might be malleable and influenced by comparison with a random value. On the one hand, self-judgments reflect our self-image, which is typically considered to be stable in adulthood. Indeed, people also strive hard to maintain a fixed, positive moral image of themselves. On the other hand, research has shown the robustness of the so-called anchoring effect on judgments and decisions. The anchoring effect refers to the influence of a previously considered comparative value (anchor) on a consecutive absolute judgment and reveals that individuals’ estimates of various quantities are flexible and can be influenced by a salient random value. The present study extends the anchoring paradigm to the domain of the self. We also investigate whether participants are more susceptible to self-serving anchors, i.e., anchors that enhance participant’s self-image, especially their moral self-image. In a pre-reregistered study via the online platform Prolific, 249 participants (156 females, 89 males, 3 other and 1 who preferred not to specify their gender; M = 35.88, SD = 13.91) ranked themselves on eight personality characteristics. However, in the anchoring conditions, respondents were asked to first indicate whether they thought they would rank higher or lower than a given anchor value before providing their estimated rank in comparison to 100 other anonymous participants. A high and a low anchor value were employed to differentiate between anchors in a desirable (self-serving) direction and anchors in an undesirable (self-diminishing) direction. In the control treatment, there was no comparison question. Subsequently, participants provided their self-rankings on the eight personality traits with two personal characteristics for each combination of the factors desirable/undesirable and moral/non-moral. We found evidence of an anchoring effect for self-judgments. Moreover, anchoring was more efficient when people were anchored in a self-serving direction: the anchoring effect was enhanced when supporting a more favorable self-view and mitigated (even reversed) when implying a deterioration of the self-image. The self-serving anchoring was more pronounced for moral than for non-moral traits. The data also provided evidence in support of a better-than-average effect in general as well as a magnified better-than-average effect for moral traits. Taken together, these results suggest that self-judgments might not be as stable in adulthood as previously thought. In addition, considerations of constructing and maintaining a positive self-image might interact with the anchoring effect on self-judgments. Potential implications of our results concern the construction and malleability of self-judgments as well as the psychological mechanism shaping anchoring.

Keywords: anchoring, better-than-average effect, self-judgments, self-serving anchoring

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