Personal decisions about health hazards are the main cause of impaired health and premature death. People smoke and eat too much and exercise too little. The lack of preventive efforts is surprising given their proven effectiveness. Arrow's (1963) classical paper suggested that moral hazard...

Higher order risk preferences are important determinants of economic behavior. We apply behavioral insights to this topic: we measure higher order risk preferences for pure gains and pure losses by controlling the reference point. We find a reflection effect not only for second order risk...