Reference Points and Effort Provision

Johannes Abeler, Armin Falk, Lorenz Goette and David Huffman

No 2009-02, Discussion Papers from The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham

Abstract: A key open question for theories of reference-dependent preferences is what determines the reference point. One candidate is expectations: what people expect could affect how they feel about what actually occurs. In a real-effort experiment, we manipulate the rational expectations of subjects and check whether this manipulation influences their effort provision. We find that effort provision is significantly different between treatments in the way predicted by models of expectation-based reference-dependent preferences: if expectations are high, subjects work longer and earn more money that if expectations are low.

Keywords: Reference Points; Expectations; Loss Aversion; Risk Aversion; Disappointment; Experiment (search for similar items in EconPapers)
JEL-codes: C91 D01 D84 J22 (search for similar items in EconPapers)
Date: 2009-01
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (12)

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Related works:
Journal Article: Reference Points and Effort Provision (2011)
Working Paper: Reference Points and Effort Provision (2011)
Working Paper: Reference Points and Effort Provision (2009)
Working Paper: Reference Points and Effort Provision (2009)
Working Paper: Reference Points and Effort Provision (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:not:notcdx:2009-02

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