Psychology Models of Management Accounting
Year: 2010
Type: article
Abstract: This review identifies subjective decision-making processes related to management accounting (MA) and uses these processes as a basis for organizing psychology-based research on MA. For each decision process we identify families of related psychology models that have supported robust theory-consistent empirical results. This MA literature addresses four main themes. First, individuals’ subjective valuation of monetary payoffs often depends on frames (reference points) provided by MA, and frames can influence the use of MA information in decision making. Second, the subjective value of non-monetary (social) payoffs from sources such as fairness, honesty, reciprocity, social identity or affect influence and are influenced by individuals’ MA-related decisions. Third, individuals’ subjective models of MA-related decisions often incorporate predictable simplifications that influence and are influenced by MA. Fourth, MA can influence — sometimes bias or limit — individuals’ learning, and learning influences MA, as individuals acquire parameter and variable values or the information to estimate them subjectively. We also identify two emerging themes and three gaps in the psychologybased MA literature.
DOI: 10.1561/1400000015
Authors: JOAN LUFT, MICHAEL D. SHIELDS, THERESA LIBBY
Institutions: Michigan State University, University of Waterloo
Language: English
Subfield: Management Information Systems
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W2153456639