Login / Signup

Social interaction effects: The impact of distributional preferences on risky choices.

Anita GantnerRudolf Kerschbamer
Published in: Journal of risk and uncertainty (2018)
This paper identifies convex distributional preferences as a possible cause for the empirical observation that agents belonging to the same group tend to behave similarly in risky environments. We first show theoretically that convex distributional preferences imply social interaction effects in risky choices in the sense that observing a peer choose a risky (safe) option increases the agent's incentive to choose the risky (safe) option as well, even when lotteries are stochastically independent and the agent can only observe the lottery chosen by the peer but not the corresponding outcome. We then confirm our theoretical predictions experimentally.
Keyphrases
  • healthcare
  • mental health
  • decision making
  • genome wide
  • dna methylation