Attribute Dependent Risk Attitudes
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2021-06-21
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en
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Abstract
This master’s thesis builds upon a growing body of literature that analyses risk attitudes across different attributes by comparing risk attitudes between scenarios involving animals’ lives, human health, and human lives, where scenarios are split into a gain and loss frame. Additionally, loss aversion is measured using a binary mixed prospect involving money to analyse whether loss aversion can explain differences in risk attitudes. Firstly, loss aversion is found to be a robust predictor of differences in risk attitudes, where loss aversion is found to positively correlate with risk-aversion over pure gains and risk-seeking over pure losses. Secondly, people are found to be significantly more risk-seeking when a decision is framed as a loss instead of a gain. Lastly, people are found to be more risk-seeking over human lives than other attributes in the loss frame. Future research should continue to elicit prospect theory components to better discern the underlying mechanisms that may cause differences in risk attitudes across varying attributes.
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Faculteit der Managementwetenschappen