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Investment decisions and negative interest rates

Bracha, Anat - 2016

portfolio is a mixed lottery. Not only do we find no effect of the frame on the investment decision, we also find no evidence of …

Persistent link: https://www.econbiz.de/10011754820

A review of the certainty effect and influence of information processing

Ramirez, Patrick A.; Levine, Daniel S. - 2013

This review considers two explanations for behavioral decision-making in reference to the certainty and framing effects …

Persistent link: https://www.econbiz.de/10010320423

Incentive effects on risk attitude in small probability prospects

Lefèbvre, Mathieu; Vieider, Ferdinand M.; Villeval, … - 2009

Most studies on the role of incentives on risk attitude report data obtained from within-subject experimental investigations. This may however raise an issue of sequentiality of effects as later choices may be influenced by earlier ones. This paper reports instead between-subject results on the...

Persistent link: https://www.econbiz.de/10010277023

Prospect theory and hedging risks

Broll, Udo; Egozcue, Martín; Wong, Wing-Keung; … - 2010

The prospect theory is one of the most popular decision-making theories. It is based on the S-shaped utility function …

Persistent link: https://www.econbiz.de/10010301357

Are banks using hidden reserves to beat earnings benchmarks? Evidence from Germany

Bornemann, Sven; Kick, Thomas; Memmel, Christoph; … - 2010

Section 340f of the German Commercial Code allows banks to provision against the special risks inherent to the banking business by building hidden reserves. Beyond risk provisioning, these reserves are implicitly accepted as an earnings management device. By analyzing financial statements of...

Persistent link: https://www.econbiz.de/10010303921

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

Third-generation prospect theory

Schmidt, Ulrich; Starmer, Chris; Sugden, Robert - In: Journal of Risk and Uncertainty 36 (2008) 3, pp. 203-223

We present a new theory of decision under uncertainty: third-generation prospect theory (PT3). This retains the … while decision weights are specified in a rank-dependent way. We show that PT3 preferences respect a state-conditional form …

Persistent link: https://www.econbiz.de/10010332930

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

Investors Facing Risk II: Loss Aversion and Wealth Allocation When Utility Is Derived From Consumption and Narrowly Framed Financial Investments

Rengifo, Erick W.; Trifan, Emanuela - 2007

decision problem is addressed in two distinct equilibrium settings in the aggregate market with a representative investor …

Persistent link: https://www.econbiz.de/10010266877

Skill reputation, prospect theory, and regret theory

Harbaugh, Richmond - 2002

When a risky decision involves both skill and chance, success or failure is a signal of the decision maker's skill …. Prospect theory's four-fold pattern of probability weighting predicts that decision makers favor long-shots, avoid near sure … any gamble, even a friendly bet with little or no money at stake, reflects poorly on the decision maker's skill. Finally …

Persistent link: https://www.econbiz.de/10010272010

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