We analyze the impact of an individual's tendency to worry on willingness to pay (WTP) for a protective measure. We report on the results of a controlled experiment with real objects at stake. Worry was measured with the Worry Domains Questionnaire, an instrument determining an individual's...

We formally represent the effects of prior gains and losses in a simple dynamic preference calculus based on prospect theory's value function and thoughts adapted from aspiration level theories. We investigate our predictions in questionnaire experiments. Since we document a strong effect of...

This article investigates whether decision makers intuitively optimize close to the normative prediction in entrepreneurial decision situations where their time must be allocated between a wage job and a newly formed venture. We offer an analytical model based on maximizing expected utility, and...

On the basis of a real high stakes insurance experiment with small probabilities of losses, we demonstrate that concern is a more important driver of WTP for insurance than subjective probability estimates when there is ambiguity surrounding the estimate. Concern is still important when...