experiments, we compare people's initial risk-taking plans to their subsequent decisions. Across settings, people accept risk as … part of a "loss-exit" strategy--planning to continue taking risk after gains and stopping after losses. Actual behavior … deviates from initial strategies by cutting gains early and chasing losses. More people accept risk when offered a commitment …

, and predictability of stock returns. The key to our results is that the agent's risk-aversion changes over time as a …

this phenomenon focus on rational gamblers who overbet longshots due to risk-love. The competing behavioral explanations …

, the essential real-world trading analogs of retail traders …

reference-dependent preferences, with a degree and distribution of loss aversion that explain common levels of risk aversion …

magnitude of the equity premium within the usual economics paradigm because the level of risk aversion necessary to justify such …

The theory of expected utility maximization (EUM) explains risk aversion as due to diminishing marginal utility of … subjects often appear to be too risk averse with regard to small gambles (while still accepting sufficiently favorable large … imprecise (and noisy) mental representation of the decision situation. In this model, risk aversion is predicted without any …