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Myopic prospect theory vs. myopic loss aversion: how general is the phenomenon?

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  • Langer, Thomas
  • Weber, Martin

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  • Langer, Thomas & Weber, Martin, 2005. "Myopic prospect theory vs. myopic loss aversion: how general is the phenomenon?," Journal of Economic Behavior & Organization, Elsevier, vol. 56(1), pages 25-38, January.
  • Handle: RePEc:eee:jeborg:v:56:y:2005:i:1:p:25-38
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    References listed on IDEAS

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    1. Thomas Langer & Martin Weber, 2001. "Prospect Theory, Mental Accounting, and Differences in Aggregated and Segregated Evaluation of Lottery Portfolios," Management Science, INFORMS, vol. 47(5), pages 716-733, May.
    2. Rabin, Matthew, 2000. "Diminishing Marginal Utility of Wealth Cannot Explain Risk Aversion," Department of Economics, Working Paper Series qt61d7b4pg, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
    3. Langer, Thomas & Weber, Martin, 2003. "Does Binding of Feedback Influence Myopic Loss Aversion? An Experimental Analysis," CEPR Discussion Papers 4084, C.E.P.R. Discussion Papers.
    4. Uri Gneezy & Jan Potters, 1997. "An Experiment on Risk Taking and Evaluation Periods," The Quarterly Journal of Economics, Oxford University Press, vol. 112(2), pages 631-645.
    5. Daniel Kahneman & Dan Lovallo, 1993. "Timid Choices and Bold Forecasts: A Cognitive Perspective on Risk Taking," Management Science, INFORMS, vol. 39(1), pages 17-31, January.
    6. Richard H. Thaler & Amos Tversky & Daniel Kahneman & Alan Schwartz, 1997. "The Effect of Myopia and Loss Aversion on Risk Taking: An Experimental Test," The Quarterly Journal of Economics, Oxford University Press, vol. 112(2), pages 647-661.
    7. Shlomo Benartzi & Richard H. Thaler, 1995. "Myopic Loss Aversion and the Equity Premium Puzzle," The Quarterly Journal of Economics, Oxford University Press, vol. 110(1), pages 73-92.
    8. Kahneman, Daniel & Tversky, Amos, 1979. "Prospect Theory: An Analysis of Decision under Risk," Econometrica, Econometric Society, vol. 47(2), pages 263-291, March.
    9. Matthew Rabin, 2000. "Risk Aversion and Expected-Utility Theory: A Calibration Theorem," Econometrica, Econometric Society, vol. 68(5), pages 1281-1292, September.
    10. Drazen Prelec, 1998. "The Probability Weighting Function," Econometrica, Econometric Society, vol. 66(3), pages 497-528, May.
    11. Daniel Kahneman & Jack L. Knetsch & Richard H. Thaler, 1991. "Anomalies: The Endowment Effect, Loss Aversion, and Status Quo Bias," Journal of Economic Perspectives, American Economic Association, vol. 5(1), pages 193-206, Winter.
    12. Lopes, Lola L., 1996. "When Time Is of the Essence: Averaging, Aspiration, and the Short Run," Organizational Behavior and Human Decision Processes, Elsevier, vol. 65(3), pages 179-189, March.
    13. Harry Markowitz, 1952. "The Utility of Wealth," Journal of Political Economy, University of Chicago Press, vol. 60, pages 151-151.
    14. Shlomo Benartzi & Richard H. Thaler, 1999. "Risk Aversion or Myopia? Choices in Repeated Gambles and Retirement Investments," Management Science, INFORMS, vol. 45(3), pages 364-381, March.
    15. Uri Gneezy & Arie Kapteyn & Jan Potters, 2003. "Evaluation Periods and Asset Prices in a Market Experiment," Journal of Finance, American Finance Association, vol. 58(2), pages 821-838, April.
    16. Read, Daniel & Loewenstein, George & Rabin, Matthew, 1999. "Choice Bracketing," Journal of Risk and Uncertainty, Springer, vol. 19(1-3), pages 171-197, December.
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    Cited by:

    1. Steinhorst, Martin P. & Bahrs, Enno, 2011. "Die Analyse der Rationalität im Verhalten von Stakeholdern des Agribusiness anhand eines Experiments," 51st Annual Conference, Halle, Germany, September 28-30, 2011 114490, German Association of Agricultural Economists (GEWISOLA).
    2. Blavatskyy, Pavlo & Pogrebna, Ganna, 2009. "Myopic loss aversion revisited," Economics Letters, Elsevier, vol. 104(1), pages 43-45, July.
    3. Howard Kunreuther & Erwann Michel-Kerjan, 2015. "Demand for fixed-price multi-year contracts: Experimental evidence from insurance decisions," Journal of Risk and Uncertainty, Springer, vol. 51(2), pages 171-194, October.
    4. Stefan Zeisberger & Thomas Langer & Martin Weber, 2012. "Why does myopia decrease the willingness to invest? Is it myopic loss aversion or myopic loss probability aversion?," Theory and Decision, Springer, vol. 72(1), pages 35-50, January.
    5. Langer, Thomas & Weber, Martin, 2003. "Does binding or feedback influence myopic loss aversion : an experimental analysis," Papers 03-20, Sonderforschungsbreich 504.
    6. James Cox & Vjollca Sadiraj & Ulrich Schmidt, 2015. "Paradoxes and mechanisms for choice under risk," Experimental Economics, Springer;Economic Science Association, vol. 18(2), pages 215-250, June.
    7. Alexander Klos & Elke U. Weber & Martin Weber, 2005. "Investment Decisions and Time Horizon: Risk Perception and Risk Behavior in Repeated Gambles," Management Science, INFORMS, vol. 51(12), pages 1777-1790, December.
    8. Thomas Epper & Helga Fehr-Duda, 2012. "The missing link: Unifying risk taking and time discounting," ECON - Working Papers 096, Department of Economics - University of Zurich.
    9. Iñigo Iturbe-Ormaetxe Kortajarene & Giovanni Ponti & Josefa Tomás, 2013. "Myopic Loss Aversion under Ambiguity and Gender Effects," Working Papers. Serie AD 2013-05, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
    10. Emily Haisley & Romel Mostafa & George Loewenstein, 2008. "Myopic risk-seeking: The impact of narrow decision bracketing on lottery play," Journal of Risk and Uncertainty, Springer, vol. 37(1), pages 57-75, August.
    11. Zeisberger, Stefan & Langer, Thomas & Trede, Mark, 2007. "A note on myopic loss aversion and the equity premium puzzle," Finance Research Letters, Elsevier, vol. 4(2), pages 127-136, June.
    12. Mehrmann, Annika & Sureth-Sloane, Caren, 2017. "Tax loss offset restrictions and biased perception of risky investments," arqus Discussion Papers in Quantitative Tax Research 222, arqus - Arbeitskreis Quantitative Steuerlehre.
    13. Hardin, Andrew M. & Looney, Clayton Arlen, 2012. "Myopic loss aversion: Demystifying the key factors influencing decision problem framing," Organizational Behavior and Human Decision Processes, Elsevier, vol. 117(2), pages 311-331.
    14. Mattos, Fabio & Garcia, Philip & Pennings, Joost M.E., 2008. "Dynamic Decision Making in Agricultural Futures and Options Markets," 2008 Conference, April 21-22, 2008, St. Louis, Missouri 37605, NCCC-134 Conference on Applied Commodity Price Analysis, Forecasting, and Market Risk Management.
    15. Langer, Thomas & Weber, Martin, 2008. "Does commitment or feedback influence myopic loss aversion?: An experimental analysis," Journal of Economic Behavior & Organization, Elsevier, vol. 67(3-4), pages 810-819, September.
    16. Inigo Iturbe-Ormaetxe & Giovanni Ponti & Josefa Tomás, 2015. "Some (Mis)facts about Myopic Loss Aversion," Working Papers CESARE 6/2015, Dipartimento di Economia e Finanza, LUISS Guido Carli.
    17. Menkhoff, Lukas & Nikiforow, Marina, 2009. "Professionals' endorsement of behavioral finance: Does it impact their perception of markets and themselves?," Journal of Economic Behavior & Organization, Elsevier, vol. 71(2), pages 318-329, August.
    18. Alexander Klos, 2013. "Myopic loss aversion: Potential causes of replication failures," Judgment and Decision Making, Society for Judgment and Decision Making, vol. 8(5), pages 617-629, September.
    19. Mattos, Fabio & Garcia, Philip, 2009. "The Effect of Prior Gains and Losses on Current Risk-Taking Using Quantile Regression," 2009 Conference, April 20-21, 2009, St. Louis, Missouri 53035, NCCC-134 Conference on Applied Commodity Price Analysis, Forecasting, and Market Risk Management.
    20. Mattos, Fabio & Garcia, Philip & Pennings, Joost M.E., 2008. "Probability weighting and loss aversion in futures hedging," Journal of Financial Markets, Elsevier, vol. 11(4), pages 433-452, November.
    21. Mattos, Fabio & Garcia, Philip & Pennings, Joost M.E., 2007. "Insights into Trader Behavior: Risk Aversion and Probability Weighting," 2007 Conference, April 16-17, 2007, Chicago, Illinois 37569, NCCC-134 Conference on Applied Commodity Price Analysis, Forecasting, and Market Risk Management.
    22. Pavlo Blavatskyy & Ganna Pogrebna, 2010. "Reevaluating evidence on myopic loss aversion: aggregate patterns versus individual choices," Theory and Decision, Springer, vol. 68(1), pages 159-171, February.

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