Predicting loss aversion behavior with machine-learning methods.

This paper proposes to forecast an important cognitive phenomenon called the Loss Aversion Bias via Hybrid Machine Learning Models. One of the unique aspects of this study is using the reaction time (milliseconds), psychological factors (self-confidence scale, Beck’s hopelessness scale, loss-aversio...

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Published in:Humanities & Social Sciences Communications pp. 1 - 15
Main Authors: Saltık, Ömür, Rehman, Wasim ul, Söyü, Rıdvan, Değirmen, Süleyman, Şengönül, Ahmet
Format: Article
Published: Springer Nature 4/27/2023
Online Access:View this record in EBSCOhost
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        10.1057/s41599-023-01620-2
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        atl: Predicting loss aversion behavior with machine-learning methods.
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          Saltık, Ömür
          Rehman, Wasim ul
          Söyü, Rıdvan
          Değirmen, Süleyman
          Şengönül, Ahmet
        affil:
          Department of Economics, Konya Food and Agriculture University, Konya, Turkey
          Department of Business Administration, University of Punjab, Gujranwala Campus, Gujranwala, Pakistan
          Department of Computer Engineering, Toros University, Mersin, Turkey
          Department of Econometrics, Sivas Cumhuriyet University, Sivas, Turkey
      sug:
      ab: This paper proposes to forecast an important cognitive phenomenon called the Loss Aversion Bias via Hybrid Machine Learning Models. One of the unique aspects of this study is using the reaction time (milliseconds), psychological factors (self-confidence scale, Beck’s hopelessness scale, loss-aversion), and personality traits (financial literacy scales, socio-demographic features) as features in classification and regression methods. We found that Random Forest was superior to other algorithms, and when the positive spread ratio (between gain and loss) converged to default loss aversion level, decision-makers minimize their decision duration while gambling, we named this phenomenon as “irresistible impulse of gambling”.
      pubtype: Academic Journal
      doctype: Article
      src: R
    language: English
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