 Linking loss aversion and present bias with overspending behavior of tourists: Insights from a lab-in-the-field experimentQuang Nguyen Tourism Management, 2016, vol. 54, issue C, 152-159 Abstract: Building upon Prospect Theory and Hyperbolic Time Discounting models, we explore how behavioral factors influence the probability of overspending among outbound leisure travelers. We construct our data in two steps. First, we collect demographics and travel-related variables from a random sample of 314 Singaporean tourists across different age groups and income levels. Second, we conduct a field experiment to measure their risk and time preferences, specifically loss aversion and present bias. We then explore the link between the measured preferences to overspending behavior. The findings reveal an interesting link between loss aversion, present bias and traveling expenditure patterns: outbound tourists with high loss aversion and high present bias are more likely to overspend. Finally, our study also highlights the role of group identity in de-biasing. Specifically, individuals are more likely to behave according to standard economic models when making decisions in groups. Keywords: Prospect theory; Present bias; Expectation; Over-spending; Lab-in-the-Field experiment (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:touman:v:54:y:2016:i:c:p:152-159 DOI: 10.1016/j.tourman.2015.09.019 Access Statistics for this article Tourism Management is currently edited by Chris Ryan More articles in Tourism Management from Elsevier |
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