Exploring the consistency of higher-order risk preferences
Haering, A.; Heinrich, T.; Mayrhofer, T.
This study measures higher‐order risk preferences and their consistency. We explore the role of country differences, the variation of stakes, and the framing of lotteries. We observe a robust dichotomous pattern of choice behavior in China, in the USA and in Germany. The majority of choices are consistent with mixed risk aversion or mixed risk‐loving behavior. We also find this pattern after a tenfold increase in the stakes. Finally, our results reveal that this pattern is strengthened if the lotteries are displayed in compound rather than reduced form. In a follow‐up study we explore potential explanations for this framing effect.
Haering, A., Heinrich, T., & Mayrhofer, T. (2020). Exploring the consistency of higher-order risk preferences. International Economic Review, 61(1), 283-320. https://doi.org/10.1111/iere.12424
|Journal Article Type||Article|
|Acceptance Date||Jun 15, 2019|
|Online Publication Date||Jan 11, 2020|
|Publication Date||Feb 28, 2020|
|Deposit Date||Jun 25, 2019|
|Publicly Available Date||Jan 11, 2022|
|Journal||International Economic Review|
|Peer Reviewed||Peer Reviewed|
Accepted Journal Article
This is the accepted version of the following article: Haering, A., Heinrich,T. & Mayrhofer,T. (2020). Exploring the consistency of higher-order risk preferences. International Economic Review 61(1): 283-320, which has been published in final form at https://doi.org/10.1111/iere.12424. This article may be used for non-commercial purposes in accordance With Wiley Terms and Conditions for self-archiving.
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