Deciding for Others Reduces Loss Aversion

Publikation: Working paperForskning

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.
Udgivelses stedKbh
UdgiverØkonomisk institut, Københavns Universitet
Antal sider38
StatusUdgivet - 2013
NavnUniversity of Copenhagen. Institute of Economics. Discussion Papers

Bibliografisk note

JEL classification: C91; D03; D81; G02

ID: 103545535