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Birnie, J (1996) Bias and financial management judgements. Journal of Financial Management of Property and Construction, 1(01), 37–54.
- Type: Journal Article
- Keywords: bias; cost prediction; decision theory/analysis; estimating; human judgement
- ISBN/ISSN: 1366-4387
- URL: http://www.emeraldinsight.com/journals.htm?issn=1366-4387
The paper considers the psychology of human predictive judgements and how this may influence decision making in the financial management of property and construction. Relevant work in behaviourial decision making related to human bias is reviewed and the extent to which professional training may improve the quality of the judgement is examined. The findings of some empirical work which confirmed the evidence of bias is reported. The overall conclusion is that many intuitive judgements are likely to contain bias. Training, however, helps to reduce the extent of the bias, and more importantly, an understanding of human behaviour in intuitive judgement making, leads to a greater awareness of the likely existence of bias.