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Measuring Risk Attitude and Relation to Marketing Behavior

  • Franken, Jason R.V.
  • Pennings, Joost M.E.
  • Garcia, Philip

Researchers employ various measures of risk attitudes to investigate their relation to market behavior with mixed results. We find that a higher-order global risk attitude construct, developed using survey scales and experiments based on expected utility theory, is related to several marketing alternatives, but does not exhibit substantially greater explanatory power than underlying measures. With few exceptions, scales yield greater significance of risk attitudes for these choices, but experimental measures reveal other insights, e.g., differential attitudes in gain and loss domains. Given recent concerns with experimental measures in the literature, we suggest studies include scales as a low cost supplemental measure.

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File URL: http://purl.umn.edu/124471
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Paper provided by Agricultural and Applied Economics Association in its series 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington with number 124471.

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Date of creation: 2012
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Handle: RePEc:ags:aaea12:124471
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  27. David R. Just & Hikaru Hanawa Peterson, 2010. "Is Expected Utility Theory Applicable? A Revealed Preference Test," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 92(1), pages 16-27.
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