Une étude expérimentale du degré individuel et collectif d’aversion au risque

This thesis investigates what motivates people to protect the environment and protect themselves from environmental risks. Specifically, the essays aim to enhance our understanding of how individual and situational factors drive decision-making in three areas that lie at the heart of behavioural environmental economics: contributions towards protecting public goods like biodiversity, choices under risk from environmental externalities like air pollution, and cooperation over shared common pool resources. The overarching goal of the thesis is to unpack the complex processes behind decision making, to identify policy-relevant mechanisms to promote both planetary and human health and wellbeing. Given this, the essays adopt an experimental approach to study themes like pro-social behaviour, affect, risk preferences, beliefs and social influence, in conjunction with different information and incentive-based interventions. Paper 1 explores the direct impact of different types of audiovisual information through the charismatic megafauna and outrage effect on contributions to biodiversity conservation. It also signals that mixed emotions could be drivers of pro-sociality in the conservation context. Paper 2 charts the indirect spillover effects of these video interventions on subsequent pro-environmental behavioural intentions. Taken together, the papers highlight the potential of the narratives in videos to encourage public engagement and conservation action to address the sixth mass extinction event. Papers 3 and 4 explore the psycho-social determinants of avoidance behaviours amongst active travellers, namely cyclists in London. In Paper 3, risk perception rather than risk preferences seem to be a better predictor of avoidance behaviour in the context and sample studied. Domain-specific risk preferences via the willingness to take health risks showed more behavioural validity as regards risk-taking while cycling, and the evidence for cross-context validity was not strong. Paper 4 showed that underlying beliefs about air quality determine how individuals respond to social norm messaging. These results collectively suggest that subjective beliefs about environmental risks influence individual choice under uncertainty in the context of air pollution avoidance. Paper 5 explores how the peer monitoring and punishment network structure affects cooperation in a commons dilemma. The results suggest that although free-riders are punished in all networks, incomplete and connected networks elicit lower punishment towards those who deviate less than the socially optimal amount. The complete network elicits more punishment, leaving this network as the least efficient at least in the short-run. Although individuals are initially optimistic about others pro-sociality across networks, beliefs converge to the selfish equilibrium more rapidly in complete networks. The results show that the underlying socio-spatial structure of peer monitoring institutions has welfare implications.

Stochastic Dominance and Nonparametric Comparative Revealed Risk Aversion

This thesis contributes to the field of behavioral economics. Research in behavioral economics investigates whether predictions of theoretical models and their underlying assumptions hold. It thereby enhances the predictive power of economics. While the first chapter provides an introduction and overview, Chapter 2 of this thesis studies whether an intergenerational transmission of risk preferences revealed by occupational choice from parents to children can be observed. The analysis shows that different male generations of a family indeed exhibit similar risky behavior, however, the link is rather weak. Chapter 3 answers the question of whether subjects are aware of the correlation between risk preferences and sociodemographic characteristics and attach informational value to sociodemographics when assessing the risk attitudes of others. The results of the experiment show that subjects recognize the correlation between the sociodemographic variables age, gender, parenthood and family status and risk preferences. Furthermore, subjects attach informational value to sociodemographic characteristics. Chapter 4 analyzes the process of the assessment of risk preferences of others in detail. A major asset is that our sample for the experiments in Chapter 3 and 4, besides student subjects, includes individuals that professionally make decisions on behalf of others every day: senior and junior advisors with differing years of counseling experience in the financial sector. In particular, it is studied whether professional and non-professional advisors are capable of correctly assessing the risk preferences of a specific advisee given sociodemographic information. The results of the experiment show, that when forming beliefs about the risk preferences of others, a false consensus bias of the advisors is present; the advisors' own risk preferences positively correlate with their beliefs about the advisees' ones. The precision of advice increases if more information is available. Professionals outperform non-professionals significantly when forecasting the risk attitudes of others. Chapter 5 of this thesis analyses whether herding out of reputational concerns exists in financial markets. Therefore, the subjects' behavior is studied in two treatments. First, in the role of financial investors, subjects take the decision which of two assets to buy without career concerns. In a second treatment, career concerns are incorporated. While in the first treatment, according to the theory, investors should always follow their own signal and buy the respective asset, in the second treatment with career concerns, investors should engage in herd behavior and neglect their own signal. However, the experimental results indicate that a similar herd behavior can be observed in the treatment with reputational concerns as well as in the treatment without reputational concerns. Moreover, we provide further evidence for investors (irrationally) imitating predecessors.

This study compares risk preferences elicited from two different methods and the resulting inconsistency rates in response behavior. We also identify and compare how demographic and socioeconomic characteristics influence risk preferences elicited from the two methods. We use experimental and survey data collected from 332 randomly selected smallholder coffee farmers in Uganda. We find relatively low inconsistency rates in the response behavior and that both methods classify most farmers as risk averse. However, a closer inspection reveals significantly different risk results. Specific demographic and socioeconomic characteristics affect farmers’ risk preferences but are not stable across elicitation methods.

PurposeEntrepreneurial aspirations are essential to the creation and survival of many businesses and to the economic development of nations. Understanding the drivers of entrepreneurial intentions is therefore of central importance from both academic and public policy perspectives. This study aims to explore how entrepreneurial intentions are affected by an individual’s need for cognition (NFC), gender, risk preferences and educational profile.Design/methodology/approachUsing survey data from 668 individuals, the effects of the above factors are empirically established and the mediating role of decision confidence is also examined.FindingsThe results indicate that NFC, gender and risk preferences affect entrepreneurial intentions. Furthermore cross-disciplinary differences in entrepreneurial intentions are found within the different sub-disciplines of business.Research limitations/implicationsThis paper expands the current body of literature by exploring the combined NFC with risk preferences and gender, on individuals’ entrepreneurial intentions. Furthermore, the entrepreneurial intentions of marketing majors are also contrasted with those of other majors.Practical implicationsThe findings of the study identify drivers of entrepreneurial intentions and their varying effects. The results can assist in the development and customization of training programs for entrepreneurs.Originality/valueTo the best of the author’s knowledge, this is the first study to examine the combined effects of NFC, gender, risk preferences and educational profile on entrepreneurial intentions.

This study aims to generalize the Preference Ranking Organization METHod for Enrichment Evaluations (PROMETHEE) III model by introducing risk preferences of decision makers. The risk preferences are expressed by an S-shaped value function with gain and loss parts. This study then illustrates an environmental evaluation of waste treatment plants for waste electrical and electronic equipment (WEEE) in Taiwan. Sensitivity analysis and the rank test demonstrate that the proposed model is rather stable. The PROMETHEE methods have been involved in various applications, especially in environmental management. One core process of PROMETHEE is to establish a preference difference function with two types of thresholds. The range of the slope lines of the linear preference is within the interval of [0, 1]. Working from the concept of the prospect theory, we extend its S-shaped function to the interval range of [-1, 1] so as to express risk preferences that occur in two quadrants. This research assesses a project on 15 local WEEE treatment plants to promote their recycling capability and technology competitiveness. According to the five aspects, the performance measures of the plants are obtained from a field study. The proposed model has an advantage on rank invariance by changing the thresholds in our case with sensitivity analysis demonstrating the robustness of the model. The generalized PROMETHEE III with risk preferences indeed provides an extension for making a decision in an uncertain environment.

We use household survey data to construct a direct measure of absolute risk aversion based on the maximum price a consumer is willing to pay for a risky security. We relate this measure to consumer's endowments and attributes and to measures of background risk and liquidity constraints. We find that risk aversion is a decreasing function of the endowment—thus rejecting CARA preferences. We estimate the elasticity of risk aversion to consumption at about 0.7, below the unitary value predicted by CRRA utility. We also find that households' attributes are of little help in predicting their degree of risk aversion, which is characterized by massive unexplained heterogeneity. We show that the consumer's environment affects risk aversion. Individuals who are more likely to face income uncertainty or to become liquidity constrained exhibit a higher degree of absolute risk aversion, consistent with recent theories of attitudes toward risk in the presence of uninsurable risks.

We consider a political economy in which government cares about risk-averse farmers’ loss of income but incurs political cost if it provides monetary support to farmers. Farmers’ expectations of government disaster aid and overconfidence (optimism bias) regarding their risk prevent farmers from purchasing full insurance under actuarially fair rates. Considering this conclusion, government prefers to subsidize farmers’ purchases of insurance ex ante rather than solely relying on disaster aid ex post. The resulting subsidy rate depends on the political environment, the degree of systemic risk, the distribution of farmers’ risk preferences, and the nature and distribution of farmers’ risk perceptions.

Many decision making problems of business and management are formulated in terms of Multiple Attribute Decision Making (MADM): given a set of alternatives evaluated with multiple criteria, find the alternative which according to the Decision Maker (DM), has the most preferred combination of criteria values (attributes), or rank alternatives from the most preferred one to the least preferred one. The MADM methods incorporate mechanisms of building preference models based on information obtained from the DM. In a wide variety of such methods, the DM is supposed to provide information in terms of weights of criteria, usually understood as criteria’s priorities. These weights serve as parameters of the method-pecific preference models. The DM can define weights directly, or by using special weight elicitation techniques such as AHP, MAVT and others. Our concerns are that when using weight-based methods, the DM cannot ensure the correctness of the preference model. First, different weight-based methods use different kinds of preference models, which prioritize criteria based on weights in different manners. Second, interpretation of weights in some MADM methods is far from intuitive. Thus, a situation may occur when an inexperienced DM thinks of weights differently than they actually work in the method, and expresses the preference information incorrectly. In this paper we demonstrate the differences between how weights are interpreted in several methods: simple additive weighting, TOPSIS, VIKOR and PROMETHEE. We do it by comparing rankings produced with methods based on randomly generated data. We demonstrate that differences of interpreting weights significantly contribute to differences in produced rankings. A solution to this problem could be twofold: first, increasing awareness of differences between method-specific weight-based prioritizing mechanisms, and second, providing interpretations of weights for popular methods in the language understandable by the DMs.

Relative risk aversion and wealth dynamics

Political candidates use a variety of negative campaigning strategies, and these attacks have different degrees of success. To explain this, I first introduce a formal model of campaign strategy to show when candidates will engage in negative campaigning and how it can affect election results. Whether candidates choose negative campaigning depends upon three factors: the voters' preconceptions about political candidates' the voters' preferred dimension, and the candidates' character traits. I show that eliminating negative campaigning has an ambiguous effect on voter welfare. Then, I extend the formal model of campaigning to include situations in which candidates campaign dishonestly. I find that allowing this is strictly inferior for voter welfare. Often this is because whenever lying becomes more probable, all campaigns start to look the same. In order to understand the implications of the formal model, I use multiple empirical testing methods. I use laboratory experiments to test how voter beliefs and voter behavior affect the frequency and content of candidates' negative campaigning. I find support for the above comparative statics hypothesis about when candidates are more likely to negatively campaign. Furthermore, the laboratory results are better explained by a quantal response equilibrium model in which voters are risk averse and are more naive than sophisticated in their Bayesian updating ability. I next consider how negative campaigning translates into votes. From survey responses, I show empirical support for candidate tactics that target specific segments of voters based upon their predilections toward accepting negativity in campaigns. One way candidates attack their rivals is by trying to make voters afraid of them. From a laboratory experiment in which subjects made social judgments about pairs of candidates who ran against each other in real elections, we found that the candidates chosen by subjects as more physically threatening had actually lost 65% of the real elections. Such correlation could arise from common neural mechanisms engaged when viewers make social judgments about faces, and when voters evaluate candidates. This was shown in two independent fMRI studies in which subjects again made judgments about images of unfamiliar politicians who had run in real elections. We found that for judgments of threat, election loss correlated with activity in the insula and ventral anterior cingulate cortex, structures known to be involved in processing negative emotions. These findings suggest that voters are influenced by negative emotions elicited by a candidate’s mere appearance. Finally, we examine the role of candidate fear in explaining voter choice in presidential elections using ANES data from 1980-2004. We find that certain groups of voters are more susceptible to fear appeals. After controlling for the factors commonly thought to affect voter decision-making, we also find further evidence that fear of presidential candidates directly affects vote choice. The results have implications for future research on negative political communication, as they suggest that threatening first impressions can harm a candidate's electoral chances. They also show that candidates who wish to successfully utilize negative campaigning must tailor their campaigns not only to reflect the weaknesses of the opponent but also to insure that their message is salient to the specific group of targeted voters.

This paper aims to understand the decision making process of people in the Kaohsiung area with regard to their preference of tea or coffee. The contributing factors behind consumers' decision-making are further investigated. This paper also looks into the frequency of tea and coffee consumer teatime habits and consumer demographic structure. The relationship between tea and coffee consumers in relation to their reasons of consuming decision-making is studied. The issues as to whether demographic variables influence the decision-making and consuming reasons are also examined. A questionnaire survey was adopted in our research, which utilizes statistical analyses. The sample was comprised of 316 people living in Kaohsiung. The main findings are: 1) Tea was preferred by most individuals. 2) Approximately 72% of the sampled subjects in Kaohsiung area have a teatime habit every week (21.5% more than 3 times a week, along with another 50.9% fewer than 3 times per week). 3) Males were older and had higher incomes than females; also, males were involved in teatime activity more frequently than their female counterparts. 4) The main factor when selecting tea or coffee was ”flavor and taste” followed by ”atmosphere and environment”. 5) Respondents who preferred tea held a significantly higher level of agreement in the areas of ”fair price”, ”health benefits”, ”friends' influences”, ”beauty benefits”, and ”religion” as influencing factors of the beverage selection compared to those who opted for coffee. Meanwhile, coffee consumers put more emphasis on ”effect of alertness and refreshment” and ”atmosphere and environment.” 6) Significant discrepancies existed among different demographic subgroups, based on gender, age, income and occupation variables in relation to certain consumption patterns. The findings of the study lend themselves to reference for teatime and cafe industry professionals.

What co-curricular interventions contribute to the academic success and retention of non-traditional commencing undergraduate students identified to be at risk of academic failure or early attrition from university when taking into account distal and proximal factors?

Our paper seeks to assess the decision to adopt organic farming practices. More specifically, we use Duration Analysis (DA) to determine why farmers adopt organic farming and the timing of adoption. We extend previous studies by including farmers’ objectives, risk preferences and agricultural policies as covariates in the DA model. The Analytical Hierarchy Process (AHP) is used as a multi-criteria decision-making methodology to measure farmers’ objectives. The empirical analysis uses farm-level data collected through a questionnaire to a sample of vineyard holdings in the Spanish region of Catalonia. Farmers’ objectives are found to influence the conversion decision. Moreover, farmers who are not risk averse are more prone to adopt organic farming. Results also identify the policy changes that have been more relevant in motivating adoption of organic practices.

The study, which was conducted at the high school RN campus of Liceo de Cagayan University, delved into the influence of gender and personality on computer game preferences, as measured by the Personality Type Inventory and computer game preference, as measured by a researcher-made questionnaire, for the 150 high school students of the said university. The researcher used the descriptive design. The survey method was also used to gather the data needed. The T-test was applied to determine the game preference of the respondents. The analyses yielded the following results: The senior high school students of Liceo de Cagayan University appeared to possess Type A personality. Moreover, it was also revealed that male high school students preferred the violent computer games, while their female counterparts preferred non-violent computer games. Lastly, the statistical test revealed that there was a significant difference between the variables. In conclusion, it can be said that the personality type of the respondents has an important influence in their computer game preferences. This is also true to computer game preferences and gender. While personality type and gender are based on a biological predisposition, it is noteworthy that the socialization process of a male or female individual is greatly influenced by culture. Keywords - Psychology, personality type, computer game preferences, descriptive design, Philippines.