We consider a simple, two period, consumption-savings model with future income uncertainty that examines the interplay of savings, precautionary savings, loss aversion, and risk. We provide the relevant theory, followed by empirical tests based on subject-specific choices, and the measurement of...

We run a laboratory experiment with a two-person game with unique pure Nash equilibrium which is also the solution of the iterative elimination of strictly dominated strategies. The subjects are asked to commit to a device that randomly picks one of three symmetric outcomes in this game...

This paper examines the higher order risk preferences of prudence and temperance for the Koszegi-Rabin (KR) expectations-based reference dependent model. Our analyses reveal that higher order risk attitudes exhibited by a KR decision maker in experimental research depend on whether risks are...