Individual-level loss aversion in riskless and risky choices

• Published in: Theory and decision Vol. 92; no. 3-4; pp. 599 - 624
• Main Authors: Gächter, Simon, Johnson, Eric J., Herrmann, Andreas
• Format: Journal Article
• Language: English
• Published: New York Springer US 01.04.2022; Springer Nature B.V
• Subjects: Behavioral/Experimental Economics; Between-subjects design; College students; Customers; Decision making; Economic Theory/Quantitative Economics/Mathematical Methods; Economics; Economics and Finance; Endowment; Experiments; Finance; Game Theory; Heterogeneity; Individual differences; Insurance; Lotteries; Management; Operations Research/Decision Theory; Social and Behav. Sciences; Sociodemographics; Statistics for Business; Wealth; Lab-in-the-field experiments; Reference-dependent preferences; Endowment effect; Loss aversion

Loss aversion can occur in riskless and risky choices. We present novel evidence on both in a non-student sample (660 randomly selected customers of a car manufacturer). We measure loss aversion in riskless choice in endowment effect experiments within and between subjects and find similar levels of...