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Estimating Parametric Loss Aversion with Prospect Theory: Recognising and Dealing with Size Dependence

Fraser, Iain M, Balcombe, Kelvin, Bardsley, Nick, Dadzie, Sam (2019) Estimating Parametric Loss Aversion with Prospect Theory: Recognising and Dealing with Size Dependence. Journal of Economic Behavior & Organization, 162 . pp. 106-119. ISSN 0167-2681. (doi:doi.org/10.1016/j.jebo.2019.04.017) (Access to this publication is currently restricted. You may be able to access a copy if URLs are provided)

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Abstract

Parameteric identi…cation of loss aversion requires either the imposition of rotational symmetry

new approach in which point dependence is reduced by integration over normalization points. To

and mixed domains. Using Bayesian econometric methods, we …nd support for Prospect Theory albeit

gains. We also show that the majority of respondents are mildly loss averse especially as the size of

the payo¤s increase.

Item Type: Article
DOI/Identification number: doi.org/10.1016/j.jebo.2019.04.017
Uncontrolled keywords: Prospect Theory; Loss Aversion; Hierarchical Bayes Methods. JEL: C93, D81, Q16
Subjects: H Social Sciences > HB Economic Theory
Divisions: Faculties > Social Sciences > School of Economics
Depositing User: Iain Fraser
Date Deposited: 23 Sep 2019 13:03 UTC
Last Modified: 24 Sep 2019 10:46 UTC
Resource URI: https://kar.kent.ac.uk/id/eprint/76737 (The current URI for this page, for reference purposes)
Fraser, Iain M: https://orcid.org/0000-0002-4689-6020
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