Towards an integrated debiasing framework for consumer

financial decisions: A reflection on debiasing research

1 | INTRODUCTION Cognitive biases are understood to be systematic deviations

Individual consumers increasingly bear the responsibility of ensuring
their personal financial plan is efficient enough to support themselves
through retirement (Gaar et al., 2022). Thus, consumers are met with
the responsibility for managing their own investments and bear the
onus for their investment decisions and the consequential risk thereof
(Keizer et al., 2019; Peteros & Maleyeff, 2015; Xiao et al., 2014).
This is prob- lematic, as research demonstrates that retail investors
have limited finan- cial literacy (Klapper & Lusardi, 2020) and, due to
cognitive biases, tend to depart from the fundamental principles of
standard finance, resulting in sub-optimal economic outcomes
(Campbell, 2006; Firth, 2020; Hirshleifer, 2001; Odean, 1999;
Tversky & Kahneman, 1974). There is thus an impetus to find
solutions to these biases. Consumer studies encompass elements of
consumer psychology and behaviour (Nocella et al., 2022; Paul &
Bhukya, 2021; Stenius & Eriksson, 2022). Indeed,
consumer ‘behaviour’ is one of the most frequent keywords in Interna-
tional Journal of Consumer Studies articles (Paul & Bhukya, 2021).
from rational or optimal choices which can lead to decision-making
errors (Tversky & Kahneman, 1974). Manifestations of inherent
behavioural biases underpin decisions leading to investor gains and
losses, which can result in unfavourable or sub-optimal outcomes
(Baker & Nofsinger, 2002; Barber & Odean, 2001; Gaar et al., 2022;
Meub & Proeger, 2016; Odean, 1998; Tversky & Kahneman, 1974).
Literature is extensive in its documentation and discussion of the
problematic consequences of biases and their effects on individuals.
Beyond bias identification, however, a body of literature seeks to
understand and improve individual investors' financial decision-making
behaviour. This research article focuses on cognitive debiasing
strategies, which are a particular element of consumer psychology; it
is not an exhaustive review of all consumer studies.
Debiasing is a means of reducing or managing the detrimental
effects of bias (Cheng & Wu, 2010; Compen et al., 2022). Debiasing
activities can therefore potentially help reduce the occurrence of
cog- nitive biases within decision making (Kreilkamp et al.,
2020). As

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efforts were considered from a financial lens as those that could
consumers manage their own finances using increasingly
influence consumer financial decisions. Articles were analysed for
complicated financial products (Goda et al., 2014; Hastings et al.,
appropriateness and coded to identify the major debiasing strategies
2013), the motiva- tion to find solutions to mitigate detrimental
within the literature, facilitated by using qualitative research software.
biases continues to grow. Indeed, research on mitigating extreme bias
Within this review, we first discuss a series of debiasing strategies from
has been described as one
literature. Five key debiasing strategies for investors are appar- ent
of science's “most pressing priorities” (Lilienfeld et al., 2009, p. 390).
within the literature: education and training, decision support sys- tems
There is currently extensive research into behavioural biases,
(DSS), financial advice, information and experience. Secondly, we
their impacts and potential solutions. Whereas previously debiasing
combine these debiasing strategies into a novel, singular debiasing
research was described as ‘uncharted’ (Lilienfeld et al., 2009, p. 391),
framework, organized using the Antecedents, Decisions, Outcomes
we consider that sufficient progress has been made to support a
(ADO) conceptual framework from Paul and Benito (2018). The orga-
liter-
nization of the identified debiasing strategies into a single, integrated
ature review of progress. Literature reviews play an important role in
debiasing framework differentiates this literature review from a fun-
influencing the development and evolution of theory within an area of
damental evaluation of the literature by proposing a means for inte-
study (Tsiotsou et al., 2022). Given the growing research in the beha-
gration. Demonstrating how multiple debiasing methods, originating in
vioural finance domain, literature reviews such as these are critical for
literature, may be organized in a framework to manage the influ- ence
knowledge synthesis and reflection (Lane, 2017; Paul & Criado, 2020).
of bias represents a unique contribution to the field. This per- spective
In addition, this research responds to prior discussions that encourage
is consistent with earlier debiasing literature reviews which find that
qualitative research approaches to financial and business research
debiasing measures may overlap despite being named differ-
paradigms (Kaczynski et al., 2014; Salmona et al., 2015). A systematic
ently (Kaufmann et al., 2010).
search for literature was undertaken for keywords pertaining to
This literature review is thus akin to a ‘review aiming for theory
debiasing individuals in online journal repositories. These debiasing
development’ by proposing a novel model for integrated debiasing
(Paul & Criado, 2020, p. 2). Our combination of multiple debiasing
to bias mitigation might be understood and combined. This objective
strategies responds to prior literature that suggests multiple, inte-
might also be described as a literature review aiming for theory
grated debiasing strategies are more effective than singular
devel- opment (Paul & Criado, 2020). The methodology is informed
strategies (Haghani et al., 2021; Kaufmann et al., 2009). Lastly,
by cur- rent literature review methodologies (Paul & Criado, 2020;
consistent with the tenets of a literature review, we suggest
Paul & Mas, 2020; Tsiotsou et al., 2022), with a focus on the
directions for future research (Fischoff, 1981; Paul & Criado, 2020).
debiasing of consumers within a financial, decision-making context.
To reflect contemporary research, we focused on two decades:
2000 to early 2022. Consistent with the approach taken in literature
2 | METHOD
review articles aiming to build a framework, we retrieved literature
from published, peer-reviewed journals to support the quality control
This article is a ‘conceptual review’ (Paul et al., 2021, p. 3) which pro-
of studies (Kaufmann et al., 2010; Paul & Criado, 2020; Paul &
poses a new theoretical framework by which the multiple
Mas, 2020). We used articles from reputable bibliographic online
approaches
data- bases: Social Science Citation Index (SSCI) and Web of Science,
as dis- cussed in Paul and Criado (2020), in addition to JSTOR and
Google Scholar. Where the database permitted filtering by topics,
results were filtered to those pertaining to business/economics,
finance and behavioural sciences. In total, this paper synthesizes
approximately 92 pieces of debiasing literature.1
The following keywords were used, in several combinations: bias
mitigation, bias management, behavioural bias mitigation, debias investor,
debiasing. Literature was analysed for its central theme and debiasing
strategy, limited to either a specific financial context or a context
that could be connected to financial decisions. Debiasing techniques
that could be replicated for an individual's decision making were also
included. The researchers manually evaluated all search results for
inclusion, initially by reading the papers' abstracts (Södergren, 2021).
Where it was unclear whether the paper was appropriate for inclusion,
the researchers reviewed the entire manuscript. We excluded articles
that simply mentioned bias or debiasing without actually testing or
studying debiasing2 in a manner similar to Södergren's (2021). Once the
initial screening for appropriateness was complete, articles were
assessed in their entirety using a manual, systematic content-analysis
driven approach and coding protocol (Paul & Benito, 2018; Paul &
Criado, 2020; Södergren, 2021). Not all literature included used lay peo-
ple as research subjects. A degree of subjectivity was applied to
ascer- tain whether the concepts could be applied to the average
consumer's
financial decisions. For example, Pavi´cevi´c and Keil (2021) use
chief
executive officers in their research on procedural rationality in debiasing
overconfidence. The principle of slowing the pace of a decision could be
implemented by any individual and thus was included within this review.
This research was enabled by the use of Nvivo software for data
analy- sis and Mendeley for reference management software.
Based on the analysis of the debiasing techniques grounded in
the literature, we categorized the literature into different debiasing
approaches: education and training, DSSs, financial advice, informa-
tion and experience. These approaches occurred to the researchers as
the most typical strategies in literature dealing with debiasing. We
also discuss where efforts have failed to debias individuals to create
a richer context within the literature review. In constructing the pro-
posed debiasing framework, which integrates the above-mentioned
debiasing approaches, we applied the ADO organizing framework
(Paul & Benito, 2018), as recommended by Tsiotsou et al. (2022) for
organizing literature.
 3

3 | RESULTS
which effectively mitigates home bias. Investors who scored highly in
a cognitive reflection test demonstrated a disinclination towards
The results section presents the identified debiasing strategies in
anchoring (Meub & Proeger, 2016). Learning efforts were also effec-
five sub-sections. Within this section, we provide an overview of the
tive mitigators of anchoring when the task was repeated and person-
liter- ature and a critical analysis thereof. This section forms the
alized feedback provided (Meub & Proeger, 2016).
foundation for our integrated debiasing framework in Section 4,
Investors with a tertiary education demonstrate a lower disposi-
which explains how the strategies discussed herewith may be
tion effect than less-educated investors (Baker et al., 2019). Other
combined to improve investor decision-making.
positive financial behaviour can arise from formal financial
education, such as reduced debt default rates and increased credit
scores (Brown et al., 2016; Urban et al., 2020). There is also evidence
3.1 | Education and training
to suggest self- attribution bias increases with education levels
(Mishra & Metilda, 2015), although formal classroom education on
Research considers education and training as potential bias miti-
compound interest was not found to reduce exponential growth bias
gators (Adame, 2016; Chang et al., 2016; Dunbar et al., 2014; Isler
(Foltice & Langer, 2018).
et al., 2020; Rennerr & Renner, 2001; Sellier et al., 2019). Education
Literature thus far has, due to somewhat mixed results, debated
develops the general cognitive ability, while training develops a
the efficacy of financial education but recent evidence suggests the
particular skill (Fischoff, 1981). Studies suggest that education may
propensity for it to result in improved financial behaviour. Literature
limit the occurrence of behavioural biases that jeopardize financial
on education and bias has largely focused on broader financial
performance (Kramer, 2012); thereby positively influencing financial
behav- iours (Kaiser et al., 2021; Kaiser & Menkhoff, 2020), with
behaviour (Kaiser et al., 2021). Training may help debias individuals
some efforts towards debiasing the disposition effect, exponential
by creating an awareness of bias (Kaufmann et al., 2009).
growth bias (Foltice, 2017; Foltice & Langer, 2018), herding, home
Literature previously expressed that there was limited evidence
bias (Graham et al., 2009), overconfidence (Kaustia & Perttula,
of general financial education resulting in long-term behavioural cor-
2012) and self- attribution bias (Mishra & Metilda, 2015). A limited
rection. Although individuals who are financially literate have a lower
body of literature, however, indicates a conclusive, causal
association with demonstrating biased behaviour (Baker et al.,
relationship between general education and debiasing. Education
2019), limited evidence was provided to conclusively indicate a
should be perceived as a long- term solution to debiasing (Vaarmets
relationship. Instead, evidence suggests that interventions to
et al., 2019).
improve financial lit- eracy result in limited behaviour changes
Debiasing activities may, alternatively, consider training that
(Fernandes et al., 2014; Willows, 2020). Financial education
spe- cifically provides experiment participants with knowledge of
initiatives' capacity to improve individual financial behaviour was
heuristics and biases (Isler et al., 2020; Kaustia & Perttula, 2012).
considered inadequate (Stolper & Walter, 2017). Instead, strategies
Training has proven effective as a debiasing strategy and can act as
aimed at specifically improving financial decision-making were
a complement to other debiasing nudges and strategies (Yoon et al.,
suggested to be more cost-effective and could achieve better
2021). Research seeks to compare and contrast the bias effect
financial behavioural outcomes (Newall & Parker, 2019; Willows,
subsequent to partici- pants receiving training. Fischoff (1981),
2020). Recent evidence, however, challenges the notion of financial
Shapira and Venezia (2001), and Isler et al. (2020) posit that training
education's potential insufficiency.
and education could reduce judgmental bias but not eliminate it.
In a large-scale meta-analysis, financial education was demon-
A sphere of contemporary research focuses on the efficacy and
strated to have positive causal effects on financial knowledge and
design of digital strategies to mitigate bias. Video games can be a use-
behaviour (Kaiser et al., 2021). The meta-analysis encompassed
ful platform to educate individuals about bias (Bessarabova
76 randomized experiments with a sample size of more than
et al., 2016). Gamification3 focused on training players about bias
160,000 individuals, which presents strong evidence to support the
has yielded fruitful results (Bessarabova et al., 2016; Dunbar et al.,
propensity for financial education initiatives to improve financial
2014; Legaki et al., 2021). Results have shown gamification yields
behaviour. No evidence was found to support the notion of signifi-
better bias mitigation against the fundamental attribution error bias
cant declines in behaviour up to 6 months after the educational
and confir- mation bias than participants watching a training video
intervention (Kaiser et al., 2021). Research also shows a relation-
about bias (Dunbar et al., 2014). Adame (2016) found that online
ship between financial literacy and individuals' subsequent financial
training was effective in mitigating anchoring and suggests ways to
behaviour (Xiao et al., 2014).
turn debiasing training into a gamified learning experience. Trading
In instances where literature specifically sought to connect com-
simulations have often been used in financial education, however,
petence to investment behaviour, certain results could be interpreted
simulations do not necessarily debias individuals (Martelli, 2013).
as successfully ‘debiasing’ the investor. Investor education and intelli-
The inclusion of puni- tive elements when simulating trading is
gence were found to play a significant role in mitigating the disposi-
advised by Martelli (2013), such as sharing in losses to help enforce
tion effect (Vaarmets et al., 2019). Investor competence was
debiasing and discourage opportunistic behaviour that occurs in
determined to be predictive of certain investment behaviours, such
such simulations.
as international diversification within a portfolio (Graham et al.,
In some instances, the research did not encompass a measure of
2009),
success to include the practical application of the theoretical
knowledge. This potential shortfall was noted in another study
investors close to the point of a decision could be more fruitful than
(Kaustia & Perttula, 2012) where participants were aware of
teaching concepts about general personal finance (Foltice &
overcon- fidence but did not translate this knowledge into
Langer, 2018) and short training courses have been confirmed in
probability esti- mates. Thus, its questionable effects in practice is a
liter- ature to work as debiasing strategies (Kaustia & Perttula, 2012;
concern about the efficacy of debiasing training; gamification,
Para- boni & da Costa, 2021). This is echoed in older debiasing
however, remains a prom- ising area for research.
literature, wherein training was considered useful for improving the
Bias mitigation strategies could be combined to enhance their
performance of individuals who are not subject-matter experts
efficacy. Kaustia and Perttula (2012) performed field experiments on
(Fischoff, 1981).
debiasing investor overconfidence. The success measures were deter-
Selection bias in journals to not report failed training outcomes,
mined by participants' self-reflection of confidence and probability
as well as trainers potentially instructing participants to select the
estimation. The lecture was found to be a successful debiasing ele-
cor- rect answer, could also skew reported results (Fischoff, 1981).
ment regarding overconfidence, but only when considered with
Specifi- cally tailored feedback, such as the warnings in Kaustia and
explicit warnings of biased behaviour. We thus propose that future
Perttula (2012), is required in addition to training to create fruitful
research might find interesting results if it continues to overlay multi-
debiasing outcomes. Further questions arise regarding the educator's
ple debiasing methods.
or trainer's role: should the onus fall on institutional education
The timing of training could also affect its efficacy. In the short
programmes (Hastings et al., 2013) or financial advisors
term, training or education seems effective immediately prior to the
(Migliavacca, 2020)? Fur- thermore, training content is important.
decision being made (Foltice, 2017). For example, research
Training that presents a rule of thumb to navigate bias may prove
supports individuals receiving specific training to make them aware
effective immediately afterwards but could be forgotten a few weeks
of and miti- gate bias immediately prior to making a long-term saving
later, which would result in partic- ipants reverting to originally
or debt deci- sion (Foltice, 2017). Training on specific bias has been
biased outcomes (Foltice, 2017).
demonstrated to be effective in the short term (Foltice & Langer,
Training has been suggested as a potential method to manage
2018). Such train- ing need not be lengthy and can provide fruitful
investor biases since the 1980s (Fischoff, 1981) and it continues to
results from brief ses- sions (Isler et al., 2020; Paraboni & da Costa,
be topical in debiasing literature. Training debiasing research
2021). Research has extended the notion of timely learning as a
remains largely connected to exploring the ability of training and
plausible debiasing solu- tion from Fernandes et al. (2014) to
education in debiasing, although promising progress has been made
demonstrate the efficacy of once- off training in practice (Sellier et
to innovate the training method through gamification (Bessarabova
al., 2019), which suggests promising
et al., 2016; Legaki et al., 2021). When compared to teaching people
avenues for further examination. Future research might specifically
about bias, experiential learning has proven more effective at
articulate a research question to determine the efficiency of ‘just in
helping participants retain debiased behaviours (Foltice, 2017). This
time’ (short-term) training at the time a decision is to be made, when could also connect to themes of personalisation or personal
compared to long-term education. Despite presenting seemingly
feedback, which were histori- cally posited as a useful element in
posi- tive outcomes, research into the propensity of education and
teaching investors bias mitigating behaviour (Fischoff, 1981). Based
training faces challenges of endogeneity in its results (Hastings et
on how Covid-19 has transformed the classroom into a digital
al., 2013). A better understanding of causal mechanisms and
environment (Neuwirth et al., 2021), future research may wish to
efficacy of debiasing is required (see Foltice, 2017).
tackle enhanced digital techniques to improve the efficiency of
The impact of extrinsic influences on the results of investor self-
debiasing training (Kaiser et al., 2021; Urban et al., 2020). Future
reported competence should be considered within experimental
research questions might explore the power of personalized learning
design and outcomes. Such influences could entail, for example,
experiences through gamification or other digital learning platforms.
indi- viduals with higher incomes and higher levels of education being
In conclusion, both education and training debiasing efforts seem
more likely to receive financial advice (Burke & Hung, 2021; Collins, promising but remain conceptually connected to older literature
2012). Thus, specific control measures for financial advice and other (Fischoff, 1981). Gamification, however, represents a novel
external influences on competence should be factored into models. advance- ment in executing this debiasing strategy. Once designed,
Additional challenges in education research include comparability the benefit of training is its potential to be scaled across multiple
because differ- ent countries have different approaches to education people (Yoon et al., 2021). Learning might also occur practically by
(Foltice & Langer, 2018). Individuals also demonstrate different developing expe- rience (da Costa et al., 2013; Foltice, 2017;
learning prefer- ences and mathematical capacity and may not List, 2003; Seru et al., 2010), which is discussed separately in
internalize knowledge at the same rate or pace (Foltice, 2017). Section 3.5.
A common message in the literature is that broadly targeted
edu- cation initiatives are best coupled with specific training
initiatives to improve outcomes. The impact of education alone on 3.2 | Decision support systems
debiasing requires more triangulation. Previously published research
recom- mended augmenting existing curricula with more extensive Literature has motivated for an integration of behavioural biases into
financial knowledge (Foltice, 2017). Specific training attempts at DSS research (Compen et al., 2022). To this end, research has put for-
debiasing ward designs and tests of computer-based DSS in an attempt to
 5
miti- gate bias. DSS are a technology solution that can aid
complex
decision-making and problem-solving (Shim et al., 2002, p. 111). incre- mental efforts beyond a mere warning, such as personalized
Indi- viduals extensively use different computing methods and feedback.
technologies to assist in investment tasks (Bhandari & Hassanein,
2012). However, formalization of a decision within a computer-based
information sys- tem does not inherently make the user of the
system more rational (George et al., 2000). Biases appear to be
sensitive to the type of deci- sion aid in use (Ohlert & Weißenberger,
2020). We combine a discus- sion of digital and analogue methods
that focus on supporting investors during the decision-making
process.

3.2.1 | Warnings

Warnings were used in an attempt to mitigate anchoring. They were

provided to experiment participants (via a DSS) at specific points in
an experiment process, which resulted in participants changing their
value estimates more often than participants who did not receive
warnings. However, the anchoring and adjustment bias was not miti-
gated (George et al., 2000). The sunk cost and herding biases were
similarly resistant to simple warnings (Compen et al., 2022; Ohlert &
Weißenberger, 2020). On the other hand, a concise narrative state-
ment warning individuals of the effect of ‘cheap-talk’ (Aadland &
Caplan, 2003, p. 496; Howard et al., 2017) was found to be effective
at mitigating hypothetical bias.
Koehler and Mercer (2009) concluded that an external cue to
estimate the number of funds operated by a mutual fund company
helped mitigate the selection neglect bias in financial advertising.
However, the study indicates that the method may not be successful
for individuals who are unable to reason statistically (i.e., individuals
who receive warnings may not interpret or act on them appropriately
if they have insufficient knowledge to do so). This aspect thus con-
nects to the overall effect of education to improve cognition and rea-
soning, as discussed previously.
A study of the impact of warnings on framing bias suggests that
receptiveness to warnings is influenced by individuals' perceived
rele- vance of the object being acquired and the nature of the
framing effect as positive or negative (Cheng & Wu, 2010).
Cumulatively, mixed results were found regarding the effectiveness
of warnings across a spectrum of contexts within DSS. Additional
efforts to integrate warnings into DSS may be required, such as
explanations of the warning or personalized feedback (Fischoff,
1981; George et al., 2000; Meub & Proeger, 2016). Alternatively, as
seen in Kaustia and Perttula (2012), a combination of warnings and
specific bias train- ing could prove more advantageous. However,
experiments that dem-
onstrate the viability of ‘warnings’ should be approached with
scepticism as the risk exists that participants are receiving
instructions instead of a simple nudge. The nature of the warning
should be clearly distinguished from an instruction to achieve a
favourable outcome.
Literature regarding this debiasing approach once again remains
consistent with Fischoff (1981), who incorporated warnings about
the possibility of bias as an element of a designed response to
reduce unwanted biases. Fischoff (1981) also alluded to the need for
 7
Given the mixed results in this literature review, contemporary supports the
research should thus move forward from simplistic warnings and
con- sider additional efforts that may successfully be combined
with warn- ings in debiasing experiments.
Fischoff (1981) discusses the idea of prompting participants to
‘work harder’ and mentally apply themselves to problems to
achieve debiasing. However, he finds that imploring participants
to work
harder does not elicit genuine behaviour nor does working harder
mit- igate hindsight or overconfidence. Implicit efforts to stimulate
mental efforts, such as a difficult font (Diaz-Lago & Matute, 2019)
or chal- lenging individuals to think of alternatives to their
decision (Hirt et al., 2004) have made strides in subtly triggering
better cognition and thus managing the influence of bias. These
subtle nudges seem to be effective and could warrant further
exploration.

3.2.2 | Software design

Bhandari and Hassanein (2012) theorized a DSS software

framework for debiasing by connecting each cognitive bias to a
theoretical miti- gator that could be built into the software. Indeed,
the effectiveness of computer-mediated DSS at mitigating
confirmation bias has been previously demonstrated in literature
alongside the efficacy of such systems to improve investor learning
(Hsu et al., 2011). Investor sensi- tivity to information salience is
reiterated in subsequent literature (Frydman & Rangel, 2014);
thus, software that alters the presentation to emphasize more
pertinent information can help guide an investor towards a less-
biased outcome. Enterprise risk management software provides
an opportune platform for an institution to functionally incorporate
debiasing for its staff (Kreilkamp et al., 2020) although this may
not be a practical tool for a typical layperson.
Similarly, Kaufmann et al. (2009) suggest that using information
technology can help break up tasks and decisions to improve
accuracy and focus to mitigate a host of biases in data analysis.
Technology can reduce environmental complexity linked to tasks,
such as combin- ing modules or systems (Kaufmann et al., 2009).
Literature in this sphere could be extended for developments in
practice, such as software that integrates behavioural finance into
financial advisors' practices (Orion, 2021).
A DSS might be employed to restructure a task or the environ-
ment in which decisions take place. Placing an investor in a
scoping regime where others scrutinize investors' results makes
them less prone to the disposition effect (Gemayel & Preda, 2018).
Furthermore, artificial intelligence and robo-advisors present areas
of innovation that combine financial advice with technology. This is
discussed fur- ther in Section 3.3.

3.2.3 | Analogue and rule-based techniques

Literature offers DSS designs that, while not software, could still
sup- port the decision-making process. Cognitive mapping is
suggested as a useful decision aid, with evidence suggesting it
mitigation of framing bias (Hodgkinson et al., 1999, 2002). Research
as an “important remedy” to retail investors (Bhattacharya
finds that implementing procedural rationality and slowing the pace at
et al., 2012, p. 976). Financial advice allows investors to take risk
the pre-deal stage of an acquisition could mitigate excessive acquisi-
and earn returns they might not achieve on their own (Gennaioli
tion premiums which are suggestive of overconfidence (Pavi´cevi
et al., 2015) and so improve their overall financial behaviour (Newall
´c & Keil, 2021). Similarly, a DSS that reduces the pace of the
& Parker, 2019).
investment decision might provide rational outcomes and reduce
When an individual investor is unable to behave perfectly rationally,
reliance on heu- ristics that trigger systematic biases.
a financial advisor's role is to enhance the investor's financial perfor-
A DSS need not be complex: a simple intervention such as
mance (Allen, 2001). In an assessment of the core role of financial advi-
prompting a decision-maker to consider both advantages and disad-
sor, Collins (2012, p. 308) includes the responsibility to ‘defuse biases
vantages of each choice is demonstrably effective in mitigating fram-
that lead to common mistakes’ and enable cognition regarding the
ing bias (Almashat et al., 2008). Research as early as Fischoff's (1981)
financial decision process. Literature indicates that nudges to examine
indicates that an effective strategy towards debiasing is to
an issue from an expert's perspective lead to individuals moderating
encourage
impulsiveness (Bialek & Sawicki, 2014). Kaufmann et al. (2009)
participants to consider alternatives (commonly known as the ‘con-
identified taking another person's perspective, for example, third
sider the opposite’ strategy), as it has been found to be conducive in
parties, as a debiasing approach. Seeking the actual perspective of a
mitigating hindsight bias, anchoring and framing (Cheng et al., 2014;
financial advisor, an expert in finance and investments, may prove useful
Nagtegaal et al., 2020; Roese & Vohs, 2012). Results that explored
in debiasing.
this concept suggest that considering alternatives helps engage a
The approach to financial advice addressing biases can be summa-
“mental stimulation mindset” (Hirt et al., 2004, p. 375), which helps
rized into three elements: attempt to change investor behaviour,
reduce the effects of bias.
adaption to investor behaviour (Pompian & Longo, 2005) or instilling
A DSS might be standardized and rule-driven for practice, con-
trust within the relationship such that decisions are delegated to the
taining neither personalisation nor warnings. Such a DSS is put for-
advisor. Attempting to change investor behaviour entails actions that
ward by Otuteye and Siddiquee (2015). By predetermining the
lead to eliminating bias within their financial decisions (Fischoff,
investment decision-making process, Otuteye and Siddiquee (2015)
1981) by applying some permutation of the strategies presented in
posit that the decision itself will adhere to logic and rationality.
this paper, such as educating the client (Migliavacca, 2020).
Emphasis is placed on data and reasoning, ergo the decision process is
The decision financial advisors should make regarding
prioritized over the outcome. In turn, cognitive bias exposure is lim-
adaptation or debiasing could be a function of client wealth
ited (provided the investor adheres to the process). Discipline and
(Pompian & Longo, 2005). This is rationalized in relation to whether
adherence to rules as a concept is sustained in other literature, such
the biases could drive the investor to poverty: unmitigated biases
as by transposing the Lean Six-Sigma approach for investing
that could result in investors outliving their retirement assets are
(Peteros & Maleyeff, 2015).
worse than an investor who could lose immaterial wealth due to
Common DSS elements towards bias mitigation entail a focus
bias.
on investor discipline, or adherence to the DSS (Otuteye &
Individuals are more likely to demonstrate willingness to change
Siddiquee, 2015; Peteros & Maleyeff, 2015) and visual presentation
their financial behaviour when confronted with debt and economic
of summarized information for ease of understanding (Bhandari &
hardship (Fiksenbaum et al., 2017). The consequences of financial mis-
Hassanein, 2012; Peteros & Maleyeff, 2015). Departures in the
takes stemming from bias for poorer households are direr than for
literature related to personalisation. Some DSS suggest
other households (Campbell, 2006). There is less room for error in
personalized warnings based on an understanding of the user
financial decision-making when the individual is poor. Thus, poorer
(Bhandari & Hassanein, 2012; George et al., 2000), in line with
investors may be more open to debiasing by their financial advisors.
Fischoff's (1981) debiasing design; others rely on a set of rules and
However, wealthier individuals tend to be those who actually receive
disregard personali- sation (Otuteye & Siddiquee, 2015). Stop-loss
professional financial advice (Collins, 2012; Hackethal et al., 2012),
orders might also be a useful rule to limit investor exposure to bias
so poor individuals might not benefit from this strategy.
(Dvorackova et al., 2021; Nolte, 2012; Richards et al., 2017). Stop
Recall that literature found challenging investors to think of alter-
losses have been found to be effective in mitigating the disposition
nate solutions or consider the opposite of their decision to be effec-
effect (Dvorackova et al., 2021; Richards et al., 2017), which could
tive at debiasing (Adame, 2016; Cheng et al., 2014; Hirt et al., 2004;
be useful for inexperienced traders in mitigating bias.
Roese & Vohs, 2012). This could, however, be challenging if an
unso- phisticated investor lacks subject-matter knowledge or has
poor finan- cial literacy (Klapper & Lusardi, 2020). A financial advisor
3.3 | Financial advice
could then play an important role in articulating alternative avenues
available to investors, by acting as a sounding board for ideas and
An investor could outsource or leverage the expertise of a
alternatives.
competent individual to reduce the effect of bias on financial
Adaptation to investor bias involves working around existing
decisions (Kramer, 2012; Levy & Tasoff, 2017; Shapira & Venezia,
investor bias rather than consciously addressing the bias. For example,
2001). Indeed, financial advice provided by professionals has been
financial advisors could mitigate their clients' home biases by
described
encour- aging investment in locally headquartered, multinational
 9
companies (O'Hagan-Luff & Berrill, 2019). Evidence suggests that
financial
 advice is successful at managing the biases of consumers.
advisors are able to enhance investors' financial awareness and finan-
cial literacy as a sustainable source of education (Migliavacca,
2020). This could be used to help investors understand and navigate
bias. Encouraging individuals to explain their rationale for the
decision helps mitigate framing effects (Cheng et al., 2014).
Prompting inves- tors to explain their rationale regarding a decision
could be built into software or could occur in conversation with a
financial advisor.
Investors are more likely to take financial advice when they trust
the advisor (Burke & Hung, 2021). Trust within a relationship could
be leveraged for investors to be more comfortable delegating financial
deci- sions to their advisors (Gennaioli et al., 2015), which then has the
poten- tial to reduce the risk of individuals acting on their own biases.
Yet, in such instances, investors risk their advisors pandering to their
own exist- ing biases when making decisions. Literature has shown
that even pro- fessionals are susceptible to bias (Fischoff, 1981;
Foerster et al., 2017; Linnainmaa et al., 2021; Tversky & Kahneman,
1974). Research also sug- gests that financial advisors may not debias
their clients and instead exploit investor biases for personal gain
(Mullainathan et al., 2012). Thus, entirely delegating financial decisions
to financial advisors may not be optimal. Working in conjunction with
(as opposed to delegating to) finan- cial advisors could, instead, best
serve investors' needs.
Research has also suggested that investors are overconfident
(Barber & Odean, 2000; Levy & Tasoff, 2017) and so may not seek
financial advice (Levy & Tasoff, 2017), which risks those individuals
who most need help not seeking counsel. An individual with strong
financial literacy skills is more likely to consult a financial advisor but
less likely to delegate the entire portfolio choice to the financial advi-
sor (Calcagno & Monticone, 2015).
Innovation in financial advice through robo-advisors is an emer-
gent focus for debiasing research. Research suggests that traits
such as being younger and having a moderate income and limited
invest- ment knowledge are more positively associated with using
robo- advice (Todd & Seay, 2021), although using human financial
advisors seems, overall, to remain preferable (Zhang et al., 2021). The
introduc- tion of robo-advisors has demonstrated promising
debiasing efforts (D'Acunto et al., 2019). For instance, robo-advice
has helped intro- duce diversification benefits to investors (D'Acunto
et al., 2019), which could be seen as mitigating home bias.
Robo-advisors seem particularly attractive to investors seeking
to prevent being taken advantage of by commission-seeking
financial advisors who are susceptible to conflicts of interest
(Brenner & Meyll, 2020). However, robo-advice still seems to
require further per- sonalisation and risk analysis development for
retail investors (Bhatia et al., 2020; Capponi et al., 2022). Robo-
advice may represent a way for the financial advice industry to
evolve through complementary or auxiliary use of artificial
intelligence (Wexler & Oberlander, 2021). Leveraging data to
produce personalized recommendations to tec- hnologically
interested clients such as millennials presents opportuni- ties for
research in better financial decision-making (Wexler & Oberlander,
2021). Based on earlier discussions regarding the value of
personalisation and financial advice, a future research proposition
might consider to what extent artificial intelligence-driven financial
 11
3.4 | Information

There are multiple aspects to information in the context of

cognitive bias mitigation: information salience, presentation and
transparency. Information is a common theme in debiasing
literature, as the ability to obtain and utilize quality information is
integral to financial invest- ment decisions. Debiasing strategies
can extend to easing access to information and support in
processing the obtained information. A DSS may present
information in a manner that encourages debiased decisions.
There is thus a clear link between informational effects and a
DSS.

3.4.1 | Information salience

Research suggests many biases arise from people failing to

assess information relevance (Hsee et al., 2019). Debiasing
investors by helping them determine what is salient could help
mitigate biases such as the sunk-cost fallacy, disposition effect
and anchoring (Frydman & Rangel, 2014; Hsee et al., 2019). This
is consistent with Pearson's (2021, 2022) perspective, which
indicates that individuals who allocate their attention and cognitive
resources (personal financial salience) to financial planning
products demonstrate better financial behaviour. Focusing
individuals' attention on financial matters is positively associated
with low retirement insecurity. In addition, the position of
information and the strength of language used can impact the
extent to which investors respond to such stimuli. For instance,
warnings positioned with sufficient promi- nence and written in
emphatic language are effective in mitigating the hot-hands bias
(Johnson et al., 2021). The specificity of infor- mation received
could also influence the halo effect bias (Utami et al., 2017),
such that specific information results in less of a halo effect.

3.4.2 | Information presentation

Cognitive biases could be attributed to the order, salience, pattern

and volume of information investors receive. Consequently,
debiasing could occur through prompting investors to reassess the
relative importance of information. Graphs and other visualizations
could influence investor decision-making by mitigating the
representative- ness bias (Bhandari & Hassanein, 2012). Duclos
(2014) presents an alternative view: as individuals rely on the
previous data point to fore- cast the subsequent data point, graph
lines may instil a biased sense of continuity. Investors may
overemphasize recent share price move- ments in predicting the
subsequent price of a stock when analysing graphs. Such
emphasis is problematic as past performance may not predict
future outcomes (Johnson et al., 2021). Efforts to mitigate recency
bias for unsophisticated investors through graphic represen- tation
of data were unsuccessful (Hellmann et al., 2017).
Roese and Vohs (2012), as well as Chang and Luo (2021) share
similar concerns regarding the potential for visual representations
to
potentially strengthen bias. Using multiple perspectives and Rieger, 2012). Literature has
visualiza- tions and showing tabular data representations in addition
to visual ones may mitigate extrapolation and hindsight bias
(Chang & Luo, 2021; Duclos, 2014; Roese & Vohs, 2012). Data
visualizations should be a supportive, not determinative, tool to
undertake decisions (Chang & Luo, 2021). Cumulatively, the
literature encourages multiple types of visualizations, and both
qualitative and quantitative data presentations.
The influence of information presentation on investor bias
extends beyond imagery. For instance, presenting information in a
difficult-to-read font can mitigate causality bias (Diaz-Lago &
Matute, 2019). The presentation currency and language of informa-
tion can influence the propensity of investors to demonstrate bias.
Companies located outside of the United States (U.S.) that elect
to report financial information in U.S. dollars have a higher propor-
tion of U.S. trades than those reporting in different currencies
(Rotenberg, 2013), which mitigates home bias for U.S. investors.
Reducing the salience of data regarding the stock purchase price
has been found to mitigate the disposition effect (Frydman &
Rangel, 2014). When bilingual investors approach decisions based
on information presented in their secondary language, they are less
sus- ceptible to framing and loss aversion biases (Xing, 2021). This is
attrib- utable to triggering secondary system cognitive processing,
which is associated with rationality and logic (Hadjichristidis et al.,
2017; Kahneman, 2011; Xing, 2021).

3.4.3 | Information transparency and quantity

Information transparency, through additional data, could further miti-

gate home bias and encourage diversification. Issuers listed on specific
segments of the Euronext Equity market made incremental informa-
tion reporting commitments. The consequential decrease in informa-
tion costs from this enhanced disclosure commitment resulted in
enhanced foreign investment. Information transparency is thus a
miti- gator of home bias (Pownall et al., 2014). Literature also
suggests that foreign companies listed in the U.S. that are subject to
PCAOB (Public Company Accounting Oversights Board) inspections
have higher
U.S. institutional investor ownership, suggesting the threat of
PCAOB inspections is a potential mitigator of home bias (He et al.,
2021).
Literature has also considered the nature of incremental
informa- tion that should be provided to investors. For example,
providing investors with additional information in the form of
retirement income projections and enrolment information has been
shown to help reduce individuals' exponential growth bias and
encourage savings (Goda et al., 2014). Additional data points based
on historic and future probabilities could support debiasing of the
conjunction fallacy (Rieger, 2012). Providing relevant and useful
information to individ- uals can improve estimates and mitigate the
time-saving bias (Fink & Pinchovski, 2020), which could be useful if
analogised to investment forecasting and decision-making.
Additional information needs a degree of specificity to result in
better investment outcomes (Ohlert & Weißenberger, 2020;
 13
suggested that training or a brief tutorial can improve decisions in Experienced investors are more
the short term and so could be used to reduce bias immediately
prior to a financial decision (Foltice, 2017). Similarly, appropriate
information should be obtained in a timely manner when
individuals are making decisions.
It appears that the nature and extent to which information can
support debiasing needs to be customized to the root of the bias
and decision being made. Providing additional information could
also increase the salience of a financial decision in an investor's
mind and provide psychological cues to prompt changed
decisions (Goda et al., 2014). While literature suggests benefits to
additional informa- tion, a degree of discretion is required in
determining the nature of the information. Information
manipulation studies seem to present largely successful outcomes
in debiasing. Problematic areas that may arise include information
overload, in which instance a financial advi- sor or DSS to help
filter information for salience might be productive.

3.5 | Experience

Initial research into debiasing suggests that substantive subject-

matter experts are not immune to heuristics and biases (Bodnaruk
& Simonov, 2015; Fischoff, 1981; Tversky & Kahneman, 1974).
How- ever, learning or cognitive development through
accumulated trading experience may also mitigate investors'
reliance on certain heuristics with the potential to improve
investment decisions (Kuo et al., 2015; Seru et al., 2010).
Experienced individual investors are expected to have a lower
tendency towards cognitive errors (Chen et al., 2007; Nolte, 2012;
Seru et al., 2010). Furthermore, individuals often indicate
experience as the most crucial source of financial learning
(Hilgert et al., 2003) which could provide better knowledge
retention (Foltice, 2017).
Literature has explored the impact of experience on bias.
Subject- matter expertise was found to help mitigate the effects of
hindsight bias (Roese & Vohs, 2012). The length of time worked
within a finan- cial occupation reduced overconfidence among bank
branch managers (Kaustia & Perttula, 2012). Kaustia et al. (2008)
demonstrated that inexperienced investors displayed a higher
anchoring bias than experi- enced, professional investors. Market
experience has also been found to debias the endowment effect
(List, 2003). Feng and Seasholes (2005), Seru et al. (2010) and
Da Costa et al. (2013) concluded that experience subdues the
disposition effect. More experienced investors who implement
more complex trading strategies within the foreign exchange
market presented a weaker disposition effect (Nolte, 2012). In
addition, sophisticated investors are less
likely to ‘round-trip’ purchase previously sold stocks (Nofsinger &
Varma, 2013) which alludes to some resistance to recency bias.
Complementing the literature on the value of experience,
Vaar- mets et al. (2019) indicate that intellect and better learning
ability can help mitigate the disposition effect. There is also
evidence that experi- enced investors working in a professional
setting tend to display com- paratively smaller disposition effects
than those in unprofessional environments (Dhar & Zhu, 2006).
aware of their personal limitations (Bodnaruk & Simonov, 2015) and
analysis of experience’ (Gist & Mitchell, 1992, p. 189) is
can adjust their portfolios according to market events.
strengthened through direct, personal experience. Self-efficacy,
Experience as a mitigator may intersect with aspects of
which can impact individuals' prospective performance and
education and training. Literature reiterates the notion that
decisions is malleable in
experience is an important teacher (Hilgert et al., 2003; Seru et al.,
nature in that it can improve with each positive, successful
2010). Students who have taken on debt are more likely to
experience (Bandura, 1982; Ouweneel et al., 2013).
understand the implica- tions of compound interest and be less
Stronger financial self-efficacy was found to be a significant
susceptible to exponential growth bias. Research demonstrates no
explanatory factor for women regarding ownership of investments
significant differences in the exponential growth bias extent between
and savings products (Farrell et al., 2016). A comprehensive review
senior and junior students, despite senior students having been
of the financial self-efficacy literature (although not specifically
formally taught the implications of compound interest (Foltice &
focused on debiasing) indicates it is a critical factor in financial
Langer, 2018). This suggests the value of experiential learning.
attitude and behaviours (Furrebøe & Nyhus, 2022). Financial self-
Not all research concludes that experience is definitively
efficacy might also be seen as a mediator between financial literacy
capable of mitigating bias. Alternative evidence suggests that
and financial behaviours (Furrebøe & Nyhus, 2022; Liu & Zhang,
overconfidence bias increases with experience (Mishra & Metilda,
2021). Confidence in investors' ability to make a decision or perform
2015). Furthermore, an emerging market study that considered
a task is a significant factor in addition to their financial literacy
the disposition effect, overconfidence and representativeness bias
(Farrell et al., 2016).
did not conclusively determine experienced and active investors to
Recall that literature considers suggestions for investors to con-
be more rational (Chen et al., 2007).
sider alternatives an effective bias mitigation strategy. That
The degree of experience can be defined with a degree of speci-
strategy's efficacy potentially intersects with investors' experience.
ficity to result in a more targeted conclusion. Where experience was
Where con- sidering alternatives is challenging for an individual, bias
articulated as investors having previously held assets with a higher
could be amplified (Hirt et al., 2004). Given their increased
risk profile, such investors demonstrated lower home bias (Karlsson
awareness, experi- enced investors might find it easier to consider
& Nordén, 2007). This is potentially useful for future research as it
alternatives before undertaking a decision. Experience brings
illus-
increased accessibility of hypothetical alternatives to decisions (Hirt
trates that the nature of what constitutes ‘experience’ is multi-fac-
et al., 2004), making more experienced investors partial to that
eted, and not necessarily the length of time spent trading or in a
debiasing approach. Future research might consider distinguishing
professional role.
between positive and negative experiences and how this interacts
Indeed, while more experienced investors are sometimes per-
with debiasing investors. As inves- tors experience loss aversion as a
ceived to be more sophisticated and rational, this may not always be
strong emotion, research might con- sider how such feelings interact
true (Chen et al., 2007). Instead, the experience might be more
with experiential learning (Kahneman & Tversky, 1979; Lucey &
useful to investors by allowing them to understand classroom-taught
Dowling, 2005; Odean, 1998; Tversky & Kahneman, 1981). This
con- cepts in practice, thus, making it a valuable education tool
yields a proposition that negative financial experiences might be
(Foltice & Langer, 2018) and more effective at helping participants
comparatively better for debiasing than positive ones.
retain debiased behaviours (Foltice, 2017). This also connects to
personalisa- tion (Fischoff, 1981). Investors who received formal
training about biases in addition to specific warnings (Kaustia &
4 | TOWARDS AN INTEGRATED
Perttula, 2012) dem- onstrated a reduction in biased behaviour.
DEBIASING FRAMEWORK
Cumulatively, this persona- lisation led to a more valuable investor
learning experience. In instances where personalisation is
The debiasing strategies discussed within this article are the
impossible, Yoon et al. (2021) sug- gest observational learning may
products of separate research endeavours. Yet, they also have the
be a more scalable and effective way to debias individuals.
potential to combine into a single cohesive decision-making process
Beyond financial education and training, research suggests that
to manage investor bias. Indeed, literature review articles should be
individuals also need to believe in their own financial capabilities
theoretically driven with an integrative approach (Tsiotsou et al.,
(Farrell et al., 2016; Gist & Mitchell, 1992). Self-efficacy is an individ-
2022). To achieve this objective, we combine elements of previously
ual's self-perceived ability to accomplish a task (Bandura, 1982;
discussed debiasing strategies to propose a theoretical model that
Furrebøe & Nyhus, 2022). Gist and Mitchell (1992), cognisant of
individual investors could apply to manage their own biases. The
Ban- dura (1982), discuss that a component of self-efficacy includes
benefit of an integrated approach to bias mitigation is that no
indi- viduals' accumulated experience. Gist and Mitchell (1992)
singular strategy is definitively able to mitigate all biases.
proceed to explain that this entails assessing the nature of the task
Literature has suggested the concept of integrating multiple
(such as an investment decision), its requirements (analysis of
debiasing methods. For example, in Kaustia and Perttula (2012),
financial informa- tion) and assessment of individuals' judgement
lec- tures and written warnings together helped mitigate
about their past per- formance in relation to the task (such as
overconfidence. The level of participant involvement and
making high performing
engagement (which is per- haps akin to the concept of personal
investments due to a particular skillset). Thus, an ‘attributional
financial salience (Pearson, 2021)) in addition to warnings were
 15
both factors
 contributing to the efficacy of debiasing framing (Cheng & Wu,
2010). In designing a system to support investor decision-making,
Bhandari and Hassanein (2012) conceptualized how multiple
approaches could be combined into a single system, which literature
suggests has value. Thus, bias may be managed by introducing multiple
debiasing strat- egies into the decision-making process. We have
organized the inte- grated debiasing strategies in a novel way
based on the ADO dimensions outlined by literature (Paul &
Benito, 2018; Tsiotsou et al., 2022). In this manner, this research
proposes a unique way for multiple debiasing methods to be
combined for the individual decision-
maker's welfare. Figure 1 visually represents the integrated approach.
4.1 | Antecedent: Intrinsic knowledge
In the long term, investors cumulatively build knowledge and experi-
ence through formal classroom education, training and trading or
investment activity (Da Costa et al., 2013; Foltice & Langer, 2018;
Kaustia et al., 2008; List, 2003). We refer to this as ‘intrinsic knowl-
edge’ which is built up over time. The first step in the process (Step
1 per Figure 1) requires investors to reflect on prior knowledge when
facing a financial decision. At this point, investors should perform a
critical self-assessment on whether they need to improve their
knowl- edge. This step is important as investors could possess
certain

Intrinsic Knowledge of Investor/Knowledge Bank

Education, financial education, financial literacy, previously accumulated experience.

Financial decision to be made

1. Reflection: What do I
already know?

Need to improve
intrinsic knowledge ?

Yes No

Obtain
training for
specific
decision 2. Seek a Decision
Support System (DSS)

Other System Financial Advisor Requires

specificity to
investor’s
Depending on the nature of demonstrated
DSS selected: bias(es)
• Historic and future
3. Obtain information looking
appropriate to the DSS • Different presentation
selected. Consider
formats
• Salient
• Consider language and
currency effects
• Cost of DSS
Conclude
decision?

Yes No

Experience
Repeat Process
gained

FIG U R E 1 Integrated Approach to Debiasing. Source: Researcher's own.


informational advantages at inception of a decision that could inform
portfolio performance (Korniotis et al., 2013). For overconfident
investors, practical nudges should be set up to compel reflection or
slow the decision-making process (Pavi´cevi´c & Keil, 2021). If
neces- sary, investors should undertake short-term training to fill
knowledge deficits (Foltice, 2017). In addition, investors will
inherently reflect on their financial self-efficacy when undertaking a
financial decision (Bandura, 1982; Farrell et al., 2016; Liu & Zhang,
2021). A potential
challenge at this step is that investors self-assess their own compe-
tence and could reach the wrong conclusion. However, previous
research has relied on individuals' self-reported metrics, such as
trad- ing experience (List, 2003) and comfort with trading, as a
competence proxy (Graham et al., 2009).
4.2 | Decisions: Seeking a DSS
Once investors are satisfied with their intrinsic knowledge, they
move to the second step: seeking an external DSS to mitigate
bias. This could be a rule-driven process to mitigate bias within
the investment decision (Otuteye & Siddiquee, 2015), a designed
software (Bhandari & Hassanein, 2012) or a financial advisor
(D'Acunto et al., 2019; Kramer, 2012). The DSS could moderate
investor overconfidence (Pavi´cevi´c & Keil, 2021) or provide
coun-
terarguments to help investors move away from framing or
anchoring bias (Bhandari & Hassanein, 2012; Hsu et al., 2011).
Challenges at this point include potential information or choice
overload, although this may only be a challenge at initial implemen-
tation; that is, once investors have decided on a DSS, they may
continue to use the same one. We suggest that if an investor finds
deciding on a DSS overwhelming, a financial advisor may be
consulted at the outset.
Once a DSS has been determined, specific additional
information should be obtained in Step 3. The nature of information
is dependent on the DSS; some information might already be
available and other information might need to be obtained through
systematic efforts. For example, it could be assumed that a financial
advisor has enough information to execute a potential trade or
provide investors with an initial rationale for the trade. When
accumulating information, inves- tors should consider multiple
aspects of information. For instance, investors should obtain both
historic and future outlooks of the deci- sion (Rieger, 2012), evaluate
the presentation currency (Rotenberg, 2013), consider the
transparency of available financial information (Pownall et al., 2014),
seek to ensure that information is salient (Hsee et al., 2019) and
consider whether multiple data presen- tation formats can be used
for ease of understanding (Duclos, 2014; Peteros & Maleyeff, 2015).
Finally, the DSS, in conjunction with information, should naturally
engage with investors' existing intrinsic knowledge and accumulated
experience. Appropriate warnings of bias during the decision-making
process should be issued. Ideally, the DSS should address biases in a
customized manner to help investors arrive at a decision displaying
limited bias.
17
4.3 | Outcomes: Concluding the decision
Once the decision has been concluded, investors would have accumu-
lated experience which then feeds back to their existing knowledge
banks to support future decisions and potentially less-biased out-
comes (List, 2003). For example, if the DSS is a financial advisor
and the advisor challenges investors to consider other outcomes and
explain the rationale behind their thinking (Bialek & Sawicki, 2014;
Cheng et al., 2014; Hirt et al., 2004), investors would be able to
respond more easily to the query based on knowledge and experi-
ence. Accumulated positive financial decisions help individuals'
finan- cial self-efficacy, posing a fruitful cycle (Bandura, 1982;
Furrebøe & Nyhus, 2022; Ouweneel et al., 2013), although poor
financial deci- sions could damage this self-efficacy.
4.4 | Operationalisation: Integrated debiasing in
a managerial decision context
Debiasing strategies need to innovate to be practically applicable.
The absence of pragmatic debiasing approaches risks a ‘knowledge
trans- fer problem’ (van de Ven & Johnson, 2006, p. 803) wherein
investors
fail to adopt the theory formulated in research. Future research might
consider designing scalable pragmatic or practical approaches to rem-
edy the knowledge transfer problem and transcend the laboratory.
Indeed, ‘the next step is to test [these strategies] in real-world set-
tings’ (Nagtegaal et al., 2020, p. 565).
The model proposed within this section has the potential to
be practicable, particularly beyond that of supporting individual
consumer decisions. For instance, it might be extended within a mana-
gerial or broader organizational context. This perspective is comple-
mentary to the research efforts of Kaufmann et al. (2009, 2010)
which contextualizes debiasing efforts within supply chain and sup-
plier selection decisions. This section provides a discussion on how
the model articulated in Figure 1 could be applied within an
organiza- tional context.
Where management in an organization need to execute a deci-
sion (be it financial or non-financial), reflection on critical skills
required should be a starting point. This might entail seeking support
outside of the decision-makers' immediate departments (such as
finance seeking the perspective of the marketing team). Reflection at
this stage might indicate that there is a skills gap. Knowledge
deficien- cies might be addressed through obtaining training for the
respective teams on the subject matter of the decision. Where the
knowledge of the organization is acceptable, the second step of
Figure 1 indicates that a DSS should be obtained.
From a corporate perspective, a DSS might entail leveraging
spe- cialist advisors or consultants in a corporate acquisition.
Literature indicates that firms utilizing specialists in mergers and
acquisitions as advisors achieved more favourable deal outcomes,
such as lower pre- miums on acquisition (Huang et al., 2014; Song
et al., 2013). These specialist advisors thus act as the equivalent of
financial advisors depicted in step two of the model per Figure 1.
 In addition, advisors or consultants might help in obtaining
might need to first question ‘Which biases are most prevalent?’ before
appro- priate information to support the decision of management by,
asking ‘Can this bias be mitigated through this method?’
for example, helping management overcome informational
Practically, two-part studies that identify the most common or
asymmetry challenges (Adra et al., 2023) and performing a due
detrimental bias among a specific population and then design
diligence process in a corporate acquisition (Huang et al., 2014;
tailored solutions for that bias permutation might achieve fruitful
Song et al., 2013). In this manner, Steps 2 and 3 of Figure 1 might
outcomes. This stems from the previously discussed concepts of
be addressed. Research has suggested that introducing advisors
personalisation for effective debiasing. Previous debiasing research
help limit the effect of the anchoring bias on management's when
has published multiple studies in a single paper (Bessarabova et al.,
undertaking mergers and acquisitions (Diao, 2022). The combined
2016; Bialek & Sawicki, 2014; Fink & Pinchovski, 2020; Rennerr &
knowledge, education, and experience of management and the
Renner, 2001). Future research might thus consider following our
appropriate subject-matter experts might combine towards a less
suggested two-part approach to ensure both consumer welfare and
biased outcome.
academic literature are enriched.
Future research might undertake engagement with consumers
or financial advisors in order to ascertain which biases are seen fre-
5 | CONCLUSION AND DIRECTIONS FOR
quently or have the most severe financial problems. Insights into the
FUTURE RESEARCH
contexts in which these biases manifest would also be useful in
refin- ing future debiasing research. For instance, if there are
This review examined various strategic approaches to bias
sufficient grounds to suggest that consumers exhibit frequent and
mitigation and which aspects of the strategies overlap. Common
financially detrimental biases whilst shopping online, future research
strategies in debiasing identified by literature include education and
might be concentrated on designing particular debiasing
training, establishing DSS, financial advice, aspects of information
interventions that are executable within an online context.
(content, presentation, salience) and accumulated experience.
Prior debiasing literature calls for multiple debiasing strategies
Debiasing, or bias mitigation, is crucial as biases could lead to
to be implemented (Haghani et al., 2021; Kaufmann et al., 2009).
investors making poor financial decisions that could be detrimental
This lit- erature review has identified core debiasing strategies from
to their wealth. There is a need to continue to develop debiasing
literature and proposed an integrated approach by which investors
strategies as inves- tors are increasingly left to manage their own
might be debiased or manage the influence of bias on their financial
wealth and retirement in a world of growing financial complexity. It is
decisions. This research thus invites creativity in how subsequent
problematic that definitive debiasing solutions do not exist, although
research may combine debiasing approaches qualitatively or test
literature sug- gests (perhaps counterintuitively) that because
such integrated methods quantitatively or experimentally. We
investors are inher- ently overconfident, there is limited demand for
encourage future research to examine integrated debiasing
such solutions (Levy & Tasoff, 2017). Biased individuals have a
methods, informed by prior literature, to progress the debiasing
limited demand for tools that could improve their financial decisions,
research agenda.
thus leading to broader theoretical questions for research, such as
The theoretical implications of this literature review additionally
who owns the debiasing agenda.
suggests that future debiasing research requires better contextual
Future research, which could be qualitative in nature, might pon-
refinement prior to designing solutions or interventions. Researchers
der whether it is the role of the state, the education system or the
need to build a robust motivation for why a particular bias is targeted
individual to equip themselves with the tools and techniques to man-
or motivate why their interventions are practicable and designed in a
age the influence of bias in financial decision-making. These questions
certain way. ‘What are the most detrimental biases? What context
might be complementary to broader financial literacy questions, par-
does this bias frequently appear in?’ Once these questions are
ticularly considering the low average levels of financial literacy on a
answered, and the deeper context of consumer behavioural patterns
global scale (Klapper & Lusardi, 2020). These questions are founda-
are under- stood, powerful bias management solutions may be
tional, and should continue to be asked, as it has the propensity to
engineered by academic literature. Answering these prefacing
influence policy and syllabus designs alike.
questions might sug- gest exploration of qualitative methods, such
Debiasing efforts or effects are not necessarily linear. For
as case studies or inter- views with consumers or practitioners. In
instance, experience may increase overconfidence but could also miti-
addition, future research should consider how multiple debiasing
gate the disposition effect (Chen et al., 2007). Future debiasing
strategies might interact and complement each other towards
research efforts should consider which biases are most prevalent or
greater debiasing efficacy.
financially detrimental. After determining the most impactful biases,
Taking the time to understand the context of the consumer and
specific mitigation strategies to test the effects of investor
their financial behavioural patterns can yield rich insights. For exam-
experience could be devised. Thus, future debiasing research needs
ple, Willows and October (2021) challenge the Anglo-Saxon
to pinpoint the most prevalent or highly detrimental biases, perhaps
perspec- tives on insufficient retirement savings of amaXhosa
given country geographics or levels of financial literacy (Klapper &
women through the lens of socialization theory by re-conceptualizing
Lusardi, 2020) and consider specific solutions, so any alternate biases
what retirement planning looks like for Black women in South Africa.
that are poten- tially exacerbated are inconsequential. Specifically,
What might seem like a hyperbolic discounting bias of the individual
future research
(with little to no personal savings) could actually reflect the individual
 19
acting as part of
a communal alternative retirement savings protocol, or a stokvel4
(Willows and October, 2021). Future debiasing research thus
broadly necessitates greater sensitivity to the socio-economic
circumstances of the consumer in designing tailored and impactful
debiasing mecha- nisms. From this perspective, there continues to
be merit to prior sug- gestions to encourage a mix of qualitative and
quantitative approaches within the broader finance research
paradigm (Kaczynski et al., 2014; Salmona et al., 2015). This research,
similar to other litera- ture reviews, is subject to inherent limitations.
Although the method-
ology explained was applied with rigour, the field of behavioural
finance and decision-making is ‘vast and it is impossible to cite
every
known work’ (Subrahmanyam, 2008, p. 13).
ACKNOWLEDGEMENT
The authors would like to thank the anonymous reviewers for their
helpful comments.
CONFLICT OF INTEREST
The authors declare no conflict of interest.
DATA AVAILABILITY STATEMENT
Data sharing is not applicable to this article as no new data was cre-
ated or analyzed in this study.
ORCID
Shreeya Jugnandan https://orcid.org/0000-0001-7527-0185
Gizelle D. Willows https://orcid.org/0000-0002-6922-1966
ENDNOTES
1
Appendix S1, which is supplementary material, provides a comprehen-
sive, tabular summary of the literature.
2
For example, we did not include articles focused solely on detecting or
testing the presence of bias, as the review focus was mitigation or
man- agement of bias. Often, this could be ascertained from the
abstract; although the researcher ensured the entire paper was read
before excluding such research.
3
The systematic process of gamification entails transforming something
that is not inherently a game into a game (Bessarabova et al., 2016;
Dunbar et al., 2014; Kim et al., 2018; Legaki et al., 2021). This is done
for a specific purpose, such as solving problems or educating people.
4
A South African term whereby a group of individuals regularly save
money and receive a sum either on a rotational basis or at the end of a
predetermined time frame.
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