IDEAS home Printed from https://ideas.repec.org/a/mve/journl/v51y2025i2p95-150.html

Does Stake Size Matter? Testing for Differences in Involuntary Responses in High-Risk and Low-Risk Environments

Author

Listed:
  • Christopher Azevedo

    (University of Central Missouri)

  • Rebecca Blaise

    (University of Central Missouri)

  • Mihaela Craioveanu

    (University of Central Missouri)

  • Jessica Den Dekker

    (University of Central Missouri)

  • David Johnson

    (University of Central Missouri)

Abstract

Using a laboratory experiment, we explore physiological responses to high and low-stakes to investigate how subjects react to risk and stake magnitude. Sub- jects are linked to devices measuring electrodermal activity and heart rate. Subjects are endowed with ten dollars and participate in a lottery that increases or decreases their earnings, with equal probability. There are two treatments: low stakes and high stakes. We find that heart rate is largely unaffected but skin conductance increases significantly once subjects are informed of the lottery, with the effect being larger in the high-stakes treatment. Being told the outcome of the lottery reduced skin conductance in both treatments, but not statistically significant. Our findings indicate that while stake size influences physiological arousal, the effects are modest. The results highlight the value of incorporating low-cost biometric measures into economic experiments and contribute to a better understanding of how risk shapes involuntary responses.

Suggested Citation

  • Christopher Azevedo & Rebecca Blaise & Mihaela Craioveanu & Jessica Den Dekker & David Johnson, 2025. "Does Stake Size Matter? Testing for Differences in Involuntary Responses in High-Risk and Low-Risk Environments," Journal of Economic Insight, Missouri Valley Economic Association, vol. 51(2), pages 95-150.
    • Handle: RePEc:mve:journl:v:51:y:2025:i:2:p:95-150
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a
    for a similarly titled item that would be available.

    More about this item

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D89 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Other
    • C81 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Microeconomic Data; Data Access

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:mve:journl:v:51:y:2025:i:2:p:95-150. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Cullen Goenner (email available below). General contact details of provider: https://edirc.repec.org/data/mveaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.