Does heuristic bias matter for long and short-term investment decision-making during the COVID-19 pandemic?

Sudirman, Wahyu Febri Ramadhan and Alif, Muhammad Ikhsan and Pratiwi, Anggun (2023) Does heuristic bias matter for long and short-term investment decision-making during the COVID-19 pandemic? Journal of Indonesian Economy and Business (JIEB), 38 (3). pp. 254-269. ISSN 2338-5847

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Abstract

This study examines the effect of heuristic behavior on investment decision-making in the long- and short term during the COVID-19 pandemic in the Indonesian capital market. The results of this study indicate that anchoring and availability bias have a positive effect on investment decision-making, while representativeness bias has no significant impact. Investment time moderates the effect of representativeness bias on irrational investment decision-making, while anchoring and availability bias are not supported. Anchoring and availability heuristics will increase irrational investment decisions, while the effect of representativeness heuristics on irrational investment decisions will decrease when investors make long-term investments.

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