Impact of Cognitive Bias on Improvised Decision-Makers’ Risk Behavior: An Analysis Based on the Mediating Effect of Expected Revenue and Risk Perception

On the basis of prospect theory and risk-benefit model, we make a theoretical research to explore the mechanism of cognitive bias in improvised decision-making. We consider that cognitive bias affect the risk behavior of improvised decision-making by impacting expected revenue and risk perception. Based on the data from 137 decision-makers of multi-level as well as the results of regression analysis, this paper indicates that: a) Expected revenue and risk perception are positively associated to risk behavior of improvised decision-making; b) Framing effect is positively associated to expected revenue of decision-makers; over-confidence and representativeness bias are negatively but availability bias are positively associated to risk perception; iii)Risk perception partially mediates the relationship between representativeness bias , availability bias and risk behavior of improvised decision-making, but completely mediates the relationship between overconfidence and risk behavior of improvised decision-making. Meantime, expected revenue completely mediates the relationship between framing effect and risk behavior of improvised decision-making.