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Multiple misbehaving: Loss averse and inattentive to monetary incentives
Engström, Per; Nordblom, Katarina; Stefánsson, Arnaldur - 2018
We study what determines taxpayers' deduction behavior when filing tax returns. Preliminary deficits might be viewed as losses assuming zero preliminary balance as reference point. Swedish taxpayers may escape these losses by claiming deductions after receiving information about the preliminary...
Persistent link: https://www.econbiz.de/10012013515
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Rationality on the Rise : Why Relative Risk Aversion Increases with Stake Size
Fehr-Duda, Helga; Bruhin, Adrian; Epper, Thomas - 2009
How does risk tolerance vary with stake size? This important question cannot be adequately answered if framing effects, nonlinear probability weighting, and heterogeneity of preference types are neglected. We show that the increase in relative risk aversion over gains cannot be captured by the...
Persistent link: https://www.econbiz.de/10014207349
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Pre-play communication with forgone costly messages: Experimental evidence on forward induction
Blume, Andreas; Kriss, Peter H.; Weber, Roberto - 2014
-play messages. In a laboratory experiment, we modify communication by making the sending of messages optional and costly. Even small …We study communication in a two-player coordination game with Pareto-ranked equilibria. Prior research demonstrates … that efficient coordination is difficult without communication but obtains regularly with (mandatory) costless pre …
Persistent link: https://www.econbiz.de/10011282459
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Myopic Loss Aversion, the Equity Premium Puzzle, and GARCH
Ågren, Martin - 2005
This paper concerns the distributional assumptions made on stock returns in the myopic loss aversion (MLA) proposed explanation to the equity premium puzzle. While Benartzi and Thaler (1995) assume temporal independence in these returns, we introduce a more realistic assumption incorporating...
Persistent link: https://www.econbiz.de/10010321544
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Stochastic expected utility and prospect theory in a horse race: A finite mixture approach
Bruhin, Adrian - 2008
This study compares the performance of Prospect Theory versus Stochastic Expected Utility Theory at fitting data on decision making under risk. Both theories incorporate well-known deviations from Expected Utility Maximization such as the Allais paradox or the fourfold pattern of risk attitudes....
Persistent link: https://www.econbiz.de/10010315494
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Loss evasion and tax aversion
Engström, Per; Nordblom, Katarina; Ohlsson, Henry; … - 2011
The objective of this paper is to study if taxpayers behave in a loss averse manner when filing their tax returns. This is important for tax design but also for understanding human behavior in general. The predictions of prospect theory can be contrasted to those of expected utility theory. We...
Persistent link: https://www.econbiz.de/10010321471
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Evaluation with dynamic reference: Sustainable investment
Vinokur, Leon - 2009
The Prospect Theory proposes to assess outcomes relative to a reference point (or benchmark). Although the literature recognises the relevance of dynamic benchmarks, most of the applications of Prospect Theory employ static reference points (or a status quo). This paper aims to develop a...
Persistent link: https://www.econbiz.de/10010280772
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Risk and Rationality : Uncovering Heterogeneity in Probability Distortion
Bruhin, Adrian; Fehr-Duda, Helga; Epper, Thomas - 2009
It has long been recognized that there is considerable heterogeneity in individual risk taking behavior but little is known about the distribution of risk taking types. We present a parsimonious characterization of risk taking behavior by estimating a finite mixture regression model for three...
Persistent link: https://www.econbiz.de/10014207351
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Time pressure preferences
Buser, Thomas; Van Veldhuizen, Roel; Zhong, Yang - 2022
. We use a lab experiment to elicit preferences for working under time pressure in an incentivized way by eliciting the …
Persistent link: https://www.econbiz.de/10014318980
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An experiment on donations, personal stories, and bad luck
Bar-El, Ronen; Hatsor, Limor; Snir, Avichai - 2023
We conducted two fundraising experiments to study the effects (1) of compassion towards the beneficiary, and (2) of giving participants an opportunity to attribute small donations to luck. We find that exposing the participants to a plea to help the beneficiary increases the average donation....
Persistent link: https://www.econbiz.de/10014388408