Abstract
Anchoring impacts risk-taking decisions. This paper provides experimental evidence (n = 744) that (social) anchors shift the Prospect Theory's value function (Kahneman and Tversky, 1979; Tversky and Kahneman, 1992). We observe that extreme (social) anchors lead to shifts in the value function, indicating a change in risk-taking. Anchors that are in line with risk-averse (risk-seeking) behavior lead, relative to the baseline, to more risk-averse (risk-seeking) decisions. Our findings are similar for social and non-social environments.
| Original language | English |
|---|---|
| Article number | 101916 |
| Journal | Quarterly Review of Economics and Finance |
| Volume | 98 |
| Number of pages | 11 |
| ISSN | 1062-9769 |
| DOIs | |
| Publication status | Published - 01.12.2024 |
Bibliographical note
Publisher Copyright:© 2024 The Author(s)
Research areas and keywords
- Anchoring
- Decisions under risk
- Peer effects
- Risk-taking
- Social interactions
- Business psychology
- Management studies
ASJC Scopus Subject Areas
- Finance
- Economics and Econometrics
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Data: The impact of (social) anchors on Prospect Theory’s value function
Loschelder, D. D. (Contributor), Pelster, M. (Creator) & Krull, S. (Contributor), Mendeley Data, 04.09.2024
DOI: 10.17632/jsmrw6dth7, https://data.mendeley.com/datasets/jsmrw6dth7
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