Research: Lindner marketing professor finds current SEC disclosures insufficient

Tougher SEC disclosures needed to protect investors

University of Cincinnati Assistant Marketing Professor Noah Van Bergen, PhD, was part of the research team that recently uncovered that advertisements touting past performance exploit decision-making biases on the part of potential investors.

Lindner College of Business faculty and staff

Van Bergen's research interests include how implicitly held beliefs influence consumer behavior and how different display formats and numerical processing influence product perceptions.

The study, titled “Fooled by Success: How, Why, and When Disclosures Fail or Work in Mutual Fund Ads,” was authored by Professors Joseph Johnson of the University of Miami Patti and Allan Herbert Business SchoolGerard J. Tellis of the University of Southern California Marshall School of Business; and Van Bergen of UC's Carl H. Lindner College of Business.

“Ads that include the SEC’s current mandated disclosure are just as likely to mislead lay investors as those with no warning whatsoever,” said Van Bergen. “Essentially, the disclosures are ineffective at mitigating biases.”

The study was published in the Journal of Public Policy & Marketing. You can read more about the study from USC’s Marshall School of Business, or read the study on SAGE journals.

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