House money effects, risk preferences and the public goods game
AbstractThis paper investigates whether risk preferences inform the decision of how much to put into the public account in the public goods game under the three different frames (the two house money effect frames: the standard and covered-loss frames, as well as the real-loss frame). The main contribution of this paper finds that the covered loss and real loss treatments are statistically equivalent. This assures researchers that just introducing the notion of loss into an experimental treatment without the need for participants to realize a real loss is still a valid experimental instrument. We also find that the house money effect is a better explanation for the difference in contributions between gain and loss framing than loss aversion.
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Bibliographic InfoArticle provided by Elsevier in its journal Economics Letters.
Volume (Year): 120 (2013)
Issue (Month): 2 ()
Contact details of provider:
Web page: http://www.elsevier.com/locate/ecolet
Risk profile; Public goods experiment; House money effect; Real losses; Covered losses; Prospect theory;
Find related papers by JEL classification:
- C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
- H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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