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Volatility, Recency Effects, and the Decision Maker
Volatility, Recency Effects, and the Decision Maker
Presenter: Larry Neal, Chevron
Presented at the 2009 DAAG Conference in Indianapolis, Indiana. Session 4 - Decision Making Under High Volatility.
What happens to decision making processes when extreme volatility replaces a more accustomed environment of uncertainty that is nonetheless more or less stable? This session focused on this question and the economic situation in 2009, in which substantial volatility resulted in many individuals being "frozen” and unable to make decisions.
Discussion of how extreme volatility in 2008-2009 affected decision makers, their trust in models and forecasting, and solutions to these issues within Chevron. Keywords: decision maker, correlation, framing framestruc, alternatives generation altgen
