2019/10/07 by Alexander Haering, Timo Heinrich, Haering, Alexander +3
Decision Sciences · Economics, Econometrics and Finance · #Decision-Making and Behavioral Economics #Economic and Environmental Valuation #Housing Market and Economics #Wirtschaft
paper · doi:10.15480/882.4665
openalex publication_date 2019/10/07 · openalex created_date 2025/10/10 · openalex updated_date 2026/07/28
This study measures higher order risk preferences and their consistency. We explore the role of country differences, the variation of stakes, and the framing of lotteries. We observe a robust dichotomous pattern of choice behavior in China, the United States, and Germany. The majority of choices are consistent with mixed risk aversion or mixed risk-loving behavior. We also find this pattern after a 10-fold increase in the stakes. Finally, our results reveal that this pattern is strengthened if the lotteries are displayed in compound instead of reduced form. In a follow-up study, we explore potential explanations for this framing effect.