'At Least I Didn't Lose Money': Nominal Loss Aversion Shapes Evaluations of Housing Transactions

Publikation: Working paperForskning

Loss aversion is one of the most robust findings to have emerged from behavioral economics. Surprisingly little attention, however, has been devoted to nominal loss aversion, the interaction of loss aversion and money illusion. People tend to think of transactions in terms of their nominal (monetary) values. Real losses may therefore loom larger in people’s minds when they lose money than when real losses are hidden by purely nominal gains. Using a survey experiment with a large and heterogeneous sample, we show that evaluations of housing transactions are systematically biased by purely nominal gains versus losses.
OriginalsprogEngelsk
Udgivelses stedCph.
UdgiverDepartment of Economics, University of Copenhagen
Antal sider32
StatusUdgivet - 2012
NavnUniversity of Copenhagen. Institute of Economics. Discussion Papers
Nummer14
Vol/bind2012
ISSN0902-6452

Bibliografisk note

JEL Classification: A10, C91, D00

ID: 40934654