Are You Risk Averse over Other People's Money?
Decisions with uncertain outcomes are often made by one party in settings where another party bears the consequences. Whenever an individual is delegated to make decisions that affect others, such as in the typical corporate structure, does the individual make decisions that reflect the risk prefere...
| Publicado en: | Southern Economic Journal Vol. 77; no. 4; pp. 901 - 914 |
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| Autores principales: | , , , |
| Formato: | Artículo |
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Wiley-Blackwell
Apr2011
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| Acceso en línea: | Ver este registro en EBSCOhost |
| fields | @attributes: recordID: 1 pdfLink: plink: https://search.ebscohost.com/login.aspx?direct=true&db=ssf&AN=60640510&site=ehost-live header: @attributes: shortDbName: ssf uiTerm: 60640510 longDbName: Social Sciences Full Text (H.W. Wilson) uiTag: AN controlInfo: bkinfo: jinfo: jid: 00384038 SEJ jtl: Southern Economic Journal issn: 00384038 maglogo: N pubinfo: dt: Apr2011 vid: 77 iid: 4 pid: 480 pub: Wiley-Blackwell artinfo: ui: 60640510 10.4284/0038-4038-77.4.901 ppf: 901 ppct: 13 formats: fmt: @attributes: type: P size: 6.4MB tig: atl: Are You Risk Averse over Other People's Money? aug: au: Chakravarty, Sujoy Harrison, Glenn W. Haruvy, Ernan E. Rutström, E. Elisabet affil: Centre for Economic Studies and Planning, School of Social Sciences, Jawaharlal Nehru University, New Mehrauli Road,' New Delhi, India 110067 Department of Risk Management & Insurance and Center for the Economic Analysis of Risk, Robinson College of Business, Georgia State University, P.O. Box 4036, Atlanta, GA 30302-4036, USA Departthent of Marketing, School of Management, University of Texas at Dallas SM 42, 800 West Campbell Road, Richardson, TX 75080-3021, USA Robinson College of Business and Department of Economics, Andrew Young School of Policy Studies, Georgia State University, Atlanta GA 30302, USA su: Risk aversion Decision making Utility theory Corporate image Loss aversion sug: subj: Risk aversion Decision making Utility theory Corporate image Loss aversion ab: Decisions with uncertain outcomes are often made by one party in settings where another party bears the consequences. Whenever an individual is delegated to make decisions that affect others, such as in the typical corporate structure, does the individual make decisions that reflect the risk preferences of the party bearing the consequences? We examine this question in two simple settings, lottery choices and sealed-bid auctions, using controlled laboratory experiments. We find that when an individual makes a decision for an anonymous stranger, there is a tendency to exhibit less risk aversion. This reduction in risk aversion is relative to his or her own preferences, and it is also relative to his or her belief about the preferences of others. This result has significant implications for the design of contracts between principals and agents. pubtype: Academic Journal doctype: Article src: R language: English refInfo: copyright: @attributes: flag: N holdings: @attributes: islocal: N |
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