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I show that a loss averse consumer who must share her budget between two goods prefer allocations for which consumption equals reference point for at least one good. The phenomenon intensity depends on the curvature of the utility curve. These results are consistent with several stylized facts...
Persistent link: https://www.econbiz.de/10011026068
In an often quoted article, Genesove and Mayer (2001) observe that house sellers are reluctant to sell at a loss, and attribute this finding to loss aversion. I show that loss aversion cannot explain this phenomenon.
Persistent link: https://www.econbiz.de/10010635268
Global environmental phenomena like climate change, major extinction events or flutype pandemics can have catastrophic consequences. By properly assessing the outcomes involved - especially those concerning human life - economic theory of choice under uncertainty is expected to help people take...
Persistent link: https://www.econbiz.de/10009645480
such differences are driven by different attitudes towards competition. In our experiment subjects choose between a … women. Women are mainly influenced by their degree of risk aversion, but men are not. Men compete more against men than …
Persistent link: https://www.econbiz.de/10008790516
stereotype of risk averse and less competitive older employees. …
Persistent link: https://www.econbiz.de/10010821398
With a market entry game inspired by Camerer and Lovallo (1999), we study the attitudes of junior and senior employees towards strategic uncertainty and competition. Seniors exhibit higher entry rates compared to juniors, especially when the market capacity is not too low or when earnings from...
Persistent link: https://www.econbiz.de/10010899002
is increasing in the tax rate as soon as a suitable relative risk aversion measure is larger with auditing, than without …
Persistent link: https://www.econbiz.de/10010933897
experiment in which they had to perform a task over fifteen stages grouped in three blocks or levels. In order to continue … through the experiment, a minimum level of success was required at the end of each level. Rewards were dependent on the final …, participants in the loss framing group choose to go further in the experiment. There was also a significant and interesting gender …
Persistent link: https://www.econbiz.de/10010750819
We investigate the relation between welfare and preference satisfaction in economics, and show that the extension of the scope of economic analysis through the 20th century forces economists to question the validity of the preference satisfaction criterion as a normative criterion for evaluating...
Persistent link: https://www.econbiz.de/10010633780
The classical expected utility model of decision under risk (von Neumann-Morgenstern, 1944) has been criticized from an … could dislike risk (prefer to any lottery its expectation) without necessarily avoiding any increase in risk ; diminishing … marginal utility may coexists with "weak" risk seeking attitudes ; decision makers with the same utility function may differ in …
Persistent link: https://www.econbiz.de/10010738473