Previous Outcomes and Reference Dependence: A Meta Study of Repeated Investment Tasks with Restricted Feedback

Hopfensitz, Astrid (2009) Previous Outcomes and Reference Dependence: A Meta Study of Repeated Investment Tasks with Restricted Feedback. TSE Working Paper, n. 09-087

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Official URL: http://tse-fr.eu/pub/22194

Abstract

When investment is repeated, previous outcomes (winning/losing) as well as the current budget level (gain/loss domain) influence decisions. The first is related to the so-called "gamblers fallacy". The second to value function relative to some reference point. Both effects have been extensively studied, however not their interaction. We present a meta-study of five experiments initially conducted to investigate myopic-lossaversion. We observe that investment is related to the number of previous winning rounds as well as to the current budget position relative to a reference point. These effects persist when the analysis is extended to settings with restricted flexibility concerning investment.

Item Type: Monograph (Working Paper)
Language: English
Date: 30 September 2009
Uncontrolled Keywords: reference point, gamblers fallacy, meta study
JEL codes: C91 - Laboratory, Individual Behavior
D81 - Criteria for Decision-Making under Risk and Uncertainty
G11 - Portfolio Choice; Investment Decisions
Subjects: B- ECONOMIE ET FINANCE
Divisions: TSE-R (Toulouse)
Site: UT1
Date Deposited: 18 Jan 2012 06:00
Last Modified: 07 Mar 2018 13:22
OAI ID: oai:tse-fr.eu:22194
URI: http://publications.ut-capitole.fr/id/eprint/3223

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