The AICPA Special Committee on Financial Reporting has urged disclosure of relevant forward-looking information on risks and opportunities to supplement conventional financial statements. We conduct a laboratory market experiment to assess the effects of such disclosures on capital allocation...

Research on cognitive processes in decision making has identified heuristics that often work well but sometimes lead to serious errors. This paper presents an investigation of the performance of heuristics in a complex dynamic setting, characterized by repeated decisions with feedback. There are...