Variation in Risk Seeking Behavior in a Natural Experiment on Large Losses Induced by a Natural Disaster

This study explores people's risk attitudes after having suffered large real-world losses following a natural disaster. Using the margins of the 2011 Australian floods (Brisbane) as a natural experimental setting, we find that homeowners who were victims of the floods and face large losses in property values are 50% more likely to opt for a risky gamble – a scratch card giving a small chance of a large gain ($500,000) - than for a sure amount of comparable value ($10). This finding is consistent with prospect theory predictions of the adoption of a risk-seeking attitude after a loss

MoreLess

Year of publication:	2012
Authors:	Page, Lionel
Other Persons:	Savage, David (contributor) ; Torgler, Benno (contributor)
Publisher:	[2012]: [S.l.] : SSRN
Subject:	Experiment \| Überschwemmung \| Flood \| Entscheidung unter Risiko \| Decision under risk \| Prospect Theory \| Prospect theory \| Katastrophenschaden \| Disaster damage \| Australien \| Australia \| Katastrophe \| Disaster

freely available

Full text |

More access options

doi.org

Check Google Scholar

In German libraries (KVK)

I need help

Which error do you want to report?

Report: URL of this record is broken

Please note: Sometimes more than one URL is available for a resource. Please click on "More Options" to display these URLs

Report: Addition of an URL to that resource

Please note: Sometimes more than one URL is available for a resource. Please click on "More Options" to display these URLs

Report: The language(s) of that resource is/are…

Please note: Required language not in the list? Please use comment field

Report: Addition of an identifier to that resource

Report: report typo

Report: Add statement

Report: Add keywords

Please use the commentary box to describe other errors

Would you like to receive a feedback?

Commentary

Please type the code from the image

For general questions please use this address.

Persistent link: https://www.econbiz.de/10013103582