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Loss Modification Incentives for Insurers under Expected Utility and Loss Aversion
Soetevent, Adriaan R. - 2014
Given the possibility to modify the probability of a loss, will a profit-maximizing insurer engage in loss prevention … or is it in his interest to increase the loss probability? This paper investigates this question. First, we calculate the … expected profit maximizing loss probability within an expected utility framework. We then use Köszegi and Rabin's (2006, 2007 …
Persistent link: https://www.econbiz.de/10013048791
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The effect of paper versus realized losses on subsequent risktaking : field evidence from casino gambling
Meier, Philippe; Flepp, Raphael; Rüdisser, Maximilian; … - 2020
In this paper, we test the realization effect, i.e., that risk-taking increases after a paper loss, whereas risk …-taking decreases after a realized loss, using gambling data from a real casino. During a particular casino visit, losses are likely …
Persistent link: https://www.econbiz.de/10012209223
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Sex hormones and choice under risk
Schipper, Burkhard - 2014
We study the correlation of choice under risk in Holt-Laury lotteries for gains and losses with gender, the use of hormonal contraceptives, menstrual cycle information, salivary testosterone, estradiol, progesterone, and cortisol as well as the digit ratio (2D:4D) in more than 200 subjects. In...
Persistent link: https://www.econbiz.de/10010255048
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Poverty, vulnerability, and reference dependent utility
Günther, Isabel; Maier, Johannes - 2013
In this paper we argue that the recent evidence on individuals' decision making is of high relevance for the measurement of poverty when switching from a static and certain to a dynamic and uncertain framework. The numerous proposed measures of multi-period poverty and vulnerability have until...
Persistent link: https://www.econbiz.de/10010225347
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Reflection for higher order risk preferences
Bleichrodt, Han; Bruggen, Paul van - 2018
Higher order risk preferences are important determinants of economic behaviour. We apply behavioural 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...
Persistent link: https://www.econbiz.de/10011924804
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The relationship between farmers' shock experiences and their uncertainty preferences - experimental evidence from Mexico
Freudenreich, Hanna; Mußhoff, Oliver; Wiercinski, Ben - 2017
to Cumulative Prospect Theory, namely the probability weighting function, the curvature of the value function and loss … related to loss aversion or ambiguity aversion. …
Persistent link: https://www.econbiz.de/10011631008
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Risk and loss aversion, price uncertainty and the implications for consumer search
Soetevent, Adriaan R.; Bruzikas, Tadas - 2016
Do the choices of consumers who search for a product's best price exhibit risk neutral, risk averse or loss averse risk … that theory predicts an inversion when consumers are either risk or loss averse. In those cases, an increase in price … assumption of risk neutrality, this finding is consistent with models of consumer risk and/or loss aversion. Moreover, the model …
Persistent link: https://www.econbiz.de/10011520488
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A decision frame theory for uncertainty with applications to regret and choice acclimatization
Feige, Christian - 2021
An axiomatization of expected utility under uncertainty is extended in several steps to characterize more complicated decision models. Central to each step is a bijective mapping that, applied to the set of prospects, changes the framing of the decision problem. Static models of subjective...
Persistent link: https://www.econbiz.de/10013220354
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Methodology for assessing the risk associated with information and knowledge loss management
Yarovenko, Hanna; Bilan, Yuriy; Lyeonov, Serhiy; … - In: Journal of business economics and management 22 (2021) 2, pp. 369-387
In practice, there is a massive time lag between data loss and its cause identification. The existing techniques …’s purpose is to develop a rapid methodology to assess the risk of information and knowledge loss management. It provides the …
Persistent link: https://www.econbiz.de/10012506098
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Investors Facing Risk : Prospect Theory and Non-Expected Utility in Portfolio Selection
Rengifo, Erick W. - 2013
-theory framework: Losses loom larger than gains of the same size (loss aversion) and the past risky-portfolio performance changes the …
Persistent link: https://www.econbiz.de/10013075905