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Loss aversion, social comparison and physical abilities at younge age

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  • Nakamoto, Yasuhiro
  • Sato, Masayuki

Abstract

We examine how physical abilities affect individuals' preferences. In particular, by incorporating social comparison into prospect theory, we directly estimate the degree of loss aversion from social comparison, a concept we term `ALJ' (\textit{Avoiding Loss relative to the Joneses}). Our main findings are as follows: (i) the participants who choose the physical education as the best subject exhibit a greater degree of ALJ than others; (ii) physical fitness influences the degree of ALJ; (iii) gender influences social comparison preferences; (iv) participants with a greater degree of ALJ do not respond to voluntary questionnaire; (v) the form of participants' ALJ is affected by the voluntary behavior of their parents. A comparison of ALJ with loss aversion in the original prospect theory reveals that they have different characteristics.

Suggested Citation

  • Nakamoto, Yasuhiro & Sato, Masayuki, 2011. "Loss aversion, social comparison and physical abilities at younge age," MPRA Paper 31221, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:31221
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    References listed on IDEAS

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    More about this item

    Keywords

    Loss aversion; Risk aversion; Social Comparison; Physical fitness; Voluntary participation;
    All these keywords.

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • C90 - Mathematical and Quantitative Methods - - Design of Experiments - - - General
    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments

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