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MANSCI
2016

Deciding for Others Reduces Loss Aversion

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Deciding for Others Reduces Loss Aversion
: We study risk taking on behalf of others, both with and without potential losses. A large-scale incentivized experiment is conducted with subjects randomly drawn from the Danish population. On average, decision makers take the same risks for other people as for themselves when losses are excluded. In contrast, when losses are possible, decisions on behalf of others are more risky. Using structural estimation, we show that this increase in risk stems from a decrease in loss aversion when others are affected by their choices.
Ola Andersson, Håkan J. Holm, Jean-Robert Ty
Added 07 Apr 2016
Updated 07 Apr 2016
Type Journal
Year 2016
Where MANSCI
Authors Ola Andersson, Håkan J. Holm, Jean-Robert Tyran, Erik Wengström
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