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Loss aversion in social image concerns

Author

Listed:
  • Vasilisa Petrishcheva

    (University of Potsdam)

  • Gerhard Riener

    (Heinrich Heine University Düsseldorf
    IHS Vienna)

  • Hannah Schildberg-Hörisch

    (Heinrich Heine University Düsseldorf
    IZA)

Abstract

Does loss aversion apply to social image concerns? In a laboratory experiment, we first induce social image in a relevant domain, intelligence, through public ranking. In a second stage, subjects experience a change in rank and are offered scope for lying to improve their final, also publicly reported rank. Subjects who care about social image and experience a decline in rank lie more than those experiencing gains. Moreover, we document a discontinuity in lying behavior when moving from rank losses to gains. Our results are in line with loss aversion in social image concerns.

Suggested Citation

  • Vasilisa Petrishcheva & Gerhard Riener & Hannah Schildberg-Hörisch, 2023. "Loss aversion in social image concerns," Experimental Economics, Springer;Economic Science Association, vol. 26(3), pages 622-645, July.
    • Handle: RePEc:kap:expeco:v:26:y:2023:i:3:d:10.1007_s10683-022-09782-7
    DOI: 10.1007/s10683-022-09782-7
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    More about this item

    Keywords

    Loss aversion; Social image concerns; Lying behavior; Laboratory experiment;
    All these keywords.

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making

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