Payment Limitations and Acreage Decisions under Risk Aversion: A Simulation Approach

2009 ◽  
Vol 91 (1) ◽  
pp. 19-41 ◽  
Author(s):  
Barry K. Goodwin
Keyword(s):  
Risk Aversion ◽  
Simulation Approach ◽  
Decisions Under Risk

scholarly journals Impact of Induced Moods, Sensation Seeking, and Emotional Contagion on Economic Decisions Under Risk

2022 ◽  
Vol 12 ◽  
Author(s):  
Kirill Efimov ◽  
Ioannis Ntoumanis ◽  
Olga Kuskova ◽  
Dzerassa Kadieva ◽  
Ksenia Panidi ◽  
...  
Keyword(s):  
Risk Aversion ◽  
Personality Traits ◽  
Risk Taking ◽  
Sensation Seeking ◽  
Financial Risk ◽  
Emotional Contagion ◽  
Simple Task ◽  
Decisions Under Risk ◽  
Increased Risk ◽  
Sad Mood

In addition to probabilities of monetary gains and losses, personality traits, socio-economic factors, and specific contexts such as emotions and framing influence financial risk taking. Here, we investigated the effects of joyful, neutral, and sad mood states on participants’ risk-taking behaviour in a simple task with safe and risky options. We also analysed the effect of framing on risk taking. In different trials, a safe option was framed in terms of either financial gains or losses. Moreover, we investigated the effects of emotional contagion and sensation-seeking personality traits on risk taking in this task. We did not observe a significant effect of induced moods on risk taking. Sad mood resulted in a slight non-significant trend of risk aversion compared to a neutral mood. Our results partially replicate previous findings regarding the presence of the framing effect. As a novel finding, we observed that participants with a low emotional contagion score demonstrated increased risk aversion during a sad mood and a similar trend at the edge of significance was present in high sensation seekers. Overall, our results highlight the importance of taking into account personality traits of experimental participants in financial risk-taking studies.

scholarly journals Farmers’ Attitudes towards Risk—An Empirical Study from Poland

Agronomy ◽  
2020 ◽  
Vol 10 (10) ◽  
pp. 1555 ◽  
Author(s):  
Piotr Sulewski ◽  
Adam Wąs ◽  
Paweł Kobus ◽  
Kinga Pogodzińska ◽  
Magdalena Szymańska ◽  
...  
Keyword(s):  
Risk Management ◽  
Risk Aversion ◽  
Research Area ◽  
Agricultural Economics ◽  
Self Assessment ◽  
Management Tools ◽  
Decisions Under Risk ◽  
Farm Accountancy Data Network ◽  
Important Research Area ◽  
Strong Risk Aversion

Risk aversion is an important research area in the field of agricultural economics in the last years. Creating effective and efficient risk management tools in an increasingly volatile economic and natural environment requires proper recognition of farmers’ behavior and attitudes towards risk. In this context, the main aim of the paper was to estimate farmers’ attitudes towards risk and identification of farm’s and farmer’s characteristics in dependency on risk aversion level. The assessment of farmers’ preferences towards risk was based on hypothetical games in a representative sample of 600 Polish farms—participants of Farm Accountancy Data Network (FADN). Based on the interviews with farmers, a relative risk aversion coefficient has been estimated. Results revealed that on average Polish farmers have quite a strong risk aversion. Their attitudes towards risk are strongly linked with their self-assessment regarding their way of making decisions under risk. Some relations between farmers’ risk aversion and perception of selected risk factors could also be observed. The results revealed that the application of specified risk management tools by farmers and their potential reaction to a significant income drop are related to risk aversion level.

scholarly journals Irrational risk aversion in an ant

2021 ◽  
Author(s):  
Massimo De Agrò ◽  
Daniel Grimwade ◽  
Richard Bach ◽  
Tomer J. Czaczkes
Keyword(s):  
Risk Aversion ◽  
Sucrose Solution ◽  
Lasius Niger ◽  
Risk Sensitivity ◽  
Eusocial Insects ◽  
Decisions Under Risk ◽  
Collective Decisions ◽  
Y Maze ◽  
Equal Chance ◽  
Relative Differences

AbstractAnimals must often decide between exploiting safe options or risky options with a chance for large gains. Both proximate theories based on perceptual mechanisms, and evolutionary ones based on fitness benefits, have been proposed to explain decisions under risk. Eusocial insects represent a special case of risk sensitivity, as they must often make collective decisions based on resource evaluations from many individuals. Previously, colonies of the ant Lasius niger were found to be risk-neutral, but the risk preference of individual foragers was unknown. Here, we tested individual L. niger in a risk sensitivity paradigm. Ants were trained to associate one scent with 0.55 M sucrose solution and another with an equal chance of either 0.1 or 1.0 M sucrose. Preference was tested in a Y-maze. Ants were extremely risk-averse, with 91% choosing the safe option. Based on the psychophysical Weber–Fechner law, we predicted that ants evaluate resources depending on their logarithmic difference. To test this hypothesis, we designed 4 more experiments by varying the relative differences between the alternatives, making the risky option less, equally or more valuable than the safe one. Our results support the logarithmic origin of risk aversion in ants, and demonstrate that the behaviour of individual foragers can be a very poor predictor of colony-level behaviour.

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