EconPapers    
Economics at your fingertips  
 

The impact of regret and worry on the threshold level of concern for flood insurance demand: Evidence from Dutch homeowners

Peter John Robinson and Wouter Botzen

Judgment and Decision Making, 2018, vol. 13, issue 3, 237-245

Abstract: It has been argued that individuals behave according to a threshold level of concern decision rule when considering protection against risk: if the perceived probability of the risk is below a threshold level, then the likelihood of the risk is treated as zero and protection is deemed unnecessary. Little is known about the determinants of this threshold nor about whether individual thresholds are related to risk specific emotions like worry and regret. We study threshold probabilities and factors that influence these in the context of flood insurance decision making. Based on data collected from 1,041 Dutch homeowners, we find that on average the threshold level of concern for flood insurance demand is negatively related to the expected regret an individual might feel about not purchasing flood insurance if a flood occurs, as well as to worry about flooding.

Keywords: flood insurance demand; threshold level of concern; risk perceptions; anticipated emotion; anticipatory emotion (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link)
http://journal.sjdm.org/18/18201a/jdm18201a.pdf (application/pdf)
http://journal.sjdm.org/18/18201a/jdm18201a.html (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:jdm:journl:v:13:y:2018:i:3:p:237-245

Access Statistics for this article

Judgment and Decision Making is currently edited by Jonathan Baron

More articles in Judgment and Decision Making from Society for Judgment and Decision Making
Bibliographic data for series maintained by Jonathan Baron ().

 
Page updated 2019-04-16
Handle: RePEc:jdm:journl:v:13:y:2018:i:3:p:237-245