Magnitude Effects in Preference Reversals

被引:2
|
作者
Lu, Yong [1 ]
Nieznanski, Marek [1 ]
机构
[1] Cardinal Stefan Wyszynski Univ Warsaw, Fac Christian Philosophy, Inst Psychol, Ul Woycickiego 1-3,14 Bldg, PL-01938 Warsaw, Poland
关键词
preference reversal; risk preference; loss aversion; loss-averse rule; WILLINGNESS-TO-PAY; PROSPECT-THEORY; DECISION-MAKING; LOSS AVERSION; MODEL COMPARISONS; RISK PREFERENCES; ECONOMIC-THEORY; MAJORITY-RULE; BEHAVIOR; CHOICE;
D O I
10.1037/npe0000145
中图分类号
F [经济];
学科分类号
02 ;
摘要
The finding that individual preferences are systematically inconsistent under different but formally equivalent modes of information processing is called the preference reversal (PR). The present research extended previously limited studies on magnitude effects of gains on PR by examining this effect with both gains and losses. Experiment 1 progressively manipulated the payoff variations in bet pairs to measure the effect of ratio scales on risk preferences and PR. Undergraduates (N = 137) were asked to choose a bet they prefer from a list of bet pairs, and then to evaluate the bets indicating how much they were willing to pay for a chance to participate in each of the bets. We observed a robust dichotomous pattern of choice behavior: The majority of choices are consistent with risk aversion or risk-seeking behavior when loss ratios between bet pairs are low and high, respectively. Moreover, different patterns of PR can be elicited with these loss stakes. Experiment 2 examined the predictions of three decision-making heuristics, namely a novel simplified approach called the loss-averse rule, the majority rule, and the equate-to-differentiate rule, as well as cumulative prospect theory that individuals may use in binary choice. Participants (N = 113) were asked to choose a bet from a list of bet pairs. We found that when the loss ratio is high, proportions of choices were in the direction predicted by cumulative prospect theory and the loss-averse rule of decision rather than by the other two rules, at both the conditional and aggregate levels. These results may suggest that when loss risk reaches a level of threshold, risk behavior for binary choices on lotteries is ubiquitously influenced by loss aversion. The overall results indicate the fragile, context-dependent nature of PR phenomenon.
引用
收藏
页码:149 / 184
页数:36
相关论文
共 50 条
  • [1] Magnitude Effects in Preference Reversals (vol 14, pg 149, 2021)
    Lu, Yong
    Nieznanski, Marek
    JOURNAL OF NEUROSCIENCE PSYCHOLOGY AND ECONOMICS, 2024, 17 (02) : 118 - 118
  • [2] The impact of asymmetric range effects on preference reversals
    Yeung, CWM
    Soman, D
    ADVANCES IN CONSUMER RESEARCH, VOL 30, 2003, 30 : 196 - 197
  • [3] EFFECTS OF EXPERIENCE ON PREFERENCE REVERSALS IN A CONTEXT OF UNCERTAINTY
    GONZALEZ, CC
    WALLSTEN, TS
    BULLETIN OF THE PSYCHONOMIC SOCIETY, 1990, 28 (06) : 526 - 526
  • [4] The Effects of Expected Value and Episodic Memory on Preference Reversals
    Lu, Yong
    Nieznanski, Marek
    Obidzinski, Michal
    REVIEW OF BEHAVIORAL ECONOMICS, 2023, 10 (02): : 105 - 161
  • [5] Modeling Preference Reversals in Context Effects over Time
    Cataldo A.M.
    Cohen A.L.
    Computational Brain & Behavior, 2021, 4 (1) : 101 - 123
  • [6] IS THERE A PROBLEM WITH PREFERENCE REVERSALS
    LI, S
    PSYCHOLOGICAL REPORTS, 1994, 74 (02) : 675 - 679
  • [7] Preference reversals with losses
    Daniel D. Holt
    Leonard Green
    Joel Myerson
    Sara J. Estle
    Psychonomic Bulletin & Review, 2008, 15 : 89 - 95
  • [8] ANOMALIES - PREFERENCE REVERSALS
    TVERSKY, A
    THALER, RH
    JOURNAL OF ECONOMIC PERSPECTIVES, 1990, 4 (02): : 201 - 211
  • [9] Preference reversals with losses
    Holt, Daniel D.
    Green, Leonard
    Myerson, Joel
    Estle, Sara J.
    PSYCHONOMIC BULLETIN & REVIEW, 2008, 15 (01) : 89 - 95
  • [10] Attention and salience in preference reversals
    Carlos Alós-Ferrer
    Alexander Ritschel
    Experimental Economics, 2022, 25 : 1024 - 1051