Averting risk in the face of large losses: Bernoulli vs. Tversky and Kahneman

Antoni Bosch-Domènech and Joaquim Silvestre

Economics Letters, 2010, vol. 107, issue 2, 180-182

Abstract: Prospect Theory asserts that people display risk attraction in high-probability losses. But our subjects tend to avoid fair risks for large ([euro]30 to [euro]90), high-probability (80%) real losses, vindicating Bernoulli's view that risk aversion is the dominant attitude.

Keywords: Losses; Risk; Attraction; Risk; aversion; Experiments; Prospect; theory; Bernoulli; Kahneman; Tversky (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (25)

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Working Paper: Averting risk in the face of large losses: Bernoulli vs. Tversky and Kahneman (2006)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:107:y:2010:i:2:p:180-182

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