Investing for Retirement: How Loss Aversion Risk Preferences Naturally Leads to Greater Retirement Income Certainty

2019 ◽  
Author(s):  
William Lim ◽  
Catherine Donnelly ◽  
Gaurav Khemka
Keyword(s):  
Loss Aversion ◽  
Risk Preferences ◽  
Retirement Income

scholarly journals Evaluating Myopic Loss Aversion of Forestland Owners

Forests ◽  
2019 ◽  
Vol 10 (2) ◽  
pp. 91
Author(s):  
Mustapha Alhassan ◽  
Marzieh Motallebi
Keyword(s):  
Loss Aversion ◽  
Risk Preferences ◽  
Price Volatility ◽  
Carbon Markets ◽  
Project Development ◽  
Economic Experiment ◽  
Myopic Loss Aversion ◽  
Carbon Offset ◽  
Optimal Evaluation ◽  
Carbon Offset Projects

Attracting forestland owners to participate in carbon markets can be challenging for several reasons including offset price volatility, legislative uncertainties, high costs of offset project development, long contract lengths, and landowners’ risk preferences. In this article, we elicit risk preferences and investigate Myopic Loss Aversion (MLA) of forestland owners using an economic experiment. The economic experiment is a betting game and we find that forestland owners exhibit MLA because they bet higher when returns from their investments are evaluated less frequently. Our results provide valuable information for developing carbon market protocols, especially in setting optimal evaluation periods of forest carbon offset projects.

scholarly journals Wildfires in Poland: The impact of risk preferences and loss aversion on environmental choices

2015 ◽  
Vol 116 ◽  
pp. 300-309 ◽  
Author(s):  
Anna Bartczak ◽  
Susan Chilton ◽  
Jürgen Meyerhoff
Keyword(s):  
Loss Aversion ◽  
Risk Preferences ◽  
The Impact

scholarly journals Farmers’ Risk Cognition, Risk Preferences and Climate Change Adaptive Behavior: A Structural Equation Modeling Approach

2019 ◽  
Vol 17 (1) ◽  
pp. 85 ◽  
Author(s):  
Rui He ◽  
Jianjun Jin ◽  
Foyuan Kuang ◽  
Chenyang Zhang ◽  
Tong Guan
Keyword(s):  
Climate Change ◽  
Adaptive Behavior ◽  
Loss Aversion ◽  
Structural Equation ◽  
Positive Impact ◽  
Rural China ◽  
Risk Preferences ◽  
Policy Issue ◽  
Positive Influence ◽  
Equation Modeling

Improving local farmers′ climate change adaptive capacity is an important policy issue in rural China. This study investigates farmers′ risk cognition, risk preferences and climate change adaptive behavior. Based on unique data from a survey and a paired lottery experiment completed by 240 rural farmers in Chongqing City of China, this paper finds that farmers have a pessimistic risk cognition towards climate change and the typical farmers are risk-averse and loss-averse. Risk cognition and adaptation cognition have significantly positive influences on climate change adaptive behavior, and loss aversion has a significantly positive influence on farmers′ adaptation decisions. Loss aversion exerts a positive impact on risk cognition and adaptation cognition, and risk aversion has a positive impact on adaptation cognition. This paper contributes to the emerging literature that relates risk preference in experiments and risk cognition to farmers′ climate change adaptive behavior.

scholarly journals History-Dependent Risk Preferences: Evidence from Individual Choices and Implications for the Disposition Effect

2019 ◽  
Vol 33 (8) ◽  
pp. 3674-3718 ◽  
Author(s):  
Angie Andrikogiannopoulou ◽  
Filippos Papakonstantinou
Keyword(s):  
Prospect Theory ◽  
Portfolio Choice ◽  
Loss Aversion ◽  
Risk Preferences ◽  
Disposition Effect ◽  
Oxford University ◽  
Dynamic Risk ◽  
Experimental Findings ◽  
Individual Choices ◽  
Published Paper

Abstract Using trading data from a sports wagering market, we estimate individuals’ dynamic risk preferences within a prospect theory paradigm. This market’s experimental-like features facilitate preference estimation, and our long panel enables us to study whether preferences vary across individuals and depend on earlier outcomes. Our estimates extend support for experimental findings—mild utility curvature, moderate loss aversion, and probability overweighting of extreme outcomes—to a market setting and reveal that preferences are heterogeneous and history dependent. Applying our estimates to a portfolio choice problem, we show prospect theory can better explain the prevalence of the disposition effect than previously thought. Authors have furnished an Internet Appendix, which is available on the Oxford University Press Web site next to the link to the final published paper online.

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