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Eliciting risk and time preferences under induced mood states

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  • Drichoutis, Andreas
  • Nayga, Rodolfo

Abstract

We test whether induced mood states have an effect on elicited risk and time preferences. Risk preferences between subjects in the control, positive mood, and negative mood treatments are neither economically nor statistically significant. However, we find that subjects induced into a positive mood exhibit higher discount rates and that subjects under negative mood do not differ significantly with a control group. Results also suggest that irrespective of mood state, introducing a cognitively demanding task before risk preference elicitation increases risk aversion and females are less risk averse when in all-female sessions than when in mixed-gender sessions.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 25731.

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Date of creation: Oct 2010
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Handle: RePEc:pra:mprapa:25731

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Keywords: discount rates; risk aversion; lab experiment; mood; affect;

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Citations

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Cited by:
  1. Maria De Paola & Francesca Gioia & Vincenzo Scoppa, 2013. "Overconfidence, Omens And Emotions: Results From A Field Experiment," Working Papers 201303, Università della Calabria, Dipartimento di Economia, Statistica e Finanza (Ex Dipartimento di Economia e Statistica).
  2. Anna Conte & M. Vittoria Levati & Chiara Nardi, 2013. "The Role of Emotions on Risk Preferences: An Experimental Analysis," Jena Economic Research Papers 2013-046, Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics.
  3. Drichoutis, Andreas & Nayga, Rodolfo & Klonaris, Stathis, 2010. "The Effects of Induced Mood on Preference Reversals and Bidding Behavior in Experimental Auction Valuation," MPRA Paper 25597, University Library of Munich, Germany.
  4. L. Corazzini & A. Filippin & P. Vanin, 2014. "Economic Behavior under Alcohol Influence: An Experiment on Time, Risk, and Social Preferences," Working Papers wp944, Dipartimento Scienze Economiche, Universita' di Bologna.

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