Budget overestimation when dealing with an uncertainty goal

Pan Zhang1, Yulang Guo2, Fang Wu3
1Business School, Sichuan University, People’s Republic of China
2School of Business Administration, Guangdong University of Finance and Economics, People’s Republic of China
3School of Accounting, Jiangxi University of Finance and Economics, People’s Republic of China
Cite this article:  Zhang, P., Guo, Y., & Wu, F. (2020). Budget overestimation when dealing with an uncertainty goal. Social Behavior and Personality: An international journal, 48(8), e8596.

Volume 48 Issue 8 | e8596 | Published: August 2020 | DOI: https://doi.org/10.2224/sbp.8596

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We conducted 2 studies (N = 86 and 248) to examine people’s tendency to overestimate their personal budget. The findings support 3 hypotheses. First, about 35% of participants in our first study tended to overestimate their budget when dealing with an uncertainty goal. Second, we found that focalism played a mediating role in this relationship. Third, in our second study we found that temporal distance positively moderated this relationship: The distant future strengthened the effect of dealing with an uncertainty goal on budget overestimation, whereas the near future attenuated it. These findings shed light on the cause and internal mechanism of consumer budget overestimation. Theoretical and practical implications are also discussed.

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