Causes, Consequences, and Cures of Myopic Loss Aversion – An Experimental Investigation

Dados Bibliográficos

ID9714468
AutoresGerlinde Fellner (Vienna University of Economics and Business Administration), Gerlinde Fellner-Röhling (0000-0002-8577-4456, Vienna University of Economics and Business), Matthias Sutter (0000-0002-6143-8706, University of Innsbruck and University of Göteborg)
Ano2009
Volume119
Fascículo537
Páginas900-916
Data de publicação2009-04-01
Peer ReviewedSim
Open AccessSim
TipoARTICLE
PeriódicoThe Economic Journal (JOURNAL)
Identificadores do periódicoISSN: 0013-0133 • E-ISSN: 1468-0297
EditoraOxford University Press (OUP) (PUBLISHER)
DOI10.1111/j.1468-0297.2009.02251.x
OpenAlexW3123722745
IdiomaEN
Citações recebidas8
Referências citadas26

We use an experiment to examine the causes, consequences and possible cures of myopic loss aversion (MLA) for investment behaviour under risk. We find that both investment horizons and feedback frequency contribute almost equally to the effects of MLA. Longer investment horizons and less frequent feedback lead to higher investments. However, when given the choice, subjects prefer on average shorter investment horizons and more frequent feedback. Exploiting the "status quo" bias by setting a long investment horizon or low feedback frequency as a default turns out to be a successful behavioural intervention to increase investment levels. Copyright © The Author(s). Journal compilation © Royal Economic Society 2009

Economics · Loss aversion · Management · Political science · Consumer Market Behavior and Pricing · Decision-Making and Behavioral Economics · Experimental Behavioral Economics Studies · Finance