APS
29th APS Annual Convention · 2017
Decision-Fatigue Impairs Loan Approvals in Banks
- Tobias Baer
McKinsey & Co., Inc. - Simone Schnall
University of Cambridge
Abstract
Credit assessment in banks follows the rational actor paradigm. Using data of a major bank, the study finds that decision-fatigue impairs the judgment of credit officers who assess numerous credit applications in a day, and establishes the economic damage caused by a significant reduction in approval rates due to ego-depletion.
Judgment and Decision Making
