Schooling as a Risky Investment: A Survey of Theory and Evidence

2014 ◽  
Vol 9 (3-4) ◽  
pp. 159-331 ◽  
Author(s):  
Joop Hartog
Keyword(s):  
Risky Investment

Moderation effect of pleasure seeking and loss aversion in the relationship between personality traits and risky investment intention

Kybernetes ◽  
2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Selim Aren ◽  
Hatice Nayman Hamamci ◽  
Safvan Özcan
Keyword(s):  
Personality Traits ◽  
Big Five ◽  
Loss Aversion ◽  
Online Survey ◽  
Big Five Personality Traits ◽  
Big Five Personality ◽  
Moderator Effect ◽  
Content Type ◽  
Risky Investment ◽  
Investment Intentions

Purpose The aim of this study, the moderating effect of pleasure-seeking and loss aversion, was investigated in relation to the big five personality traits with regard to risky investment intentions. Design/methodology/approach In the study, the data was obtained between January and November 2019 via an online survey with convenience sampling. The total number of subjects is 886. The authors used IBM SPSS Statistics for analysis. Exploratory factor analysis, correlation analysis, regression analysis and discriminant analysis were performed. Findings Significant relationships were found between five personality traits and risky investment intentions. In these relationships, the moderator effect of pleasure-seeking for extraversion, conscientiousness and neuroticism personality traits was also determined. Besides, investment preferences for choosing “unknown and new investment” against “known and experienced investment”, which is a typical feature of the balloon periods, were modeled with big five personality traits and motivation variables (pleasure-seeking and loss aversion) and the equation was formed. As a result, high accuracy classification success was obtained. Originality/value The study is unique owing to its findings. In addition, general risk aversion and risky investment intention were investigated simultaneously to explain the different findings in the literature regarding the attitude of big five personality traits to risk and personality traits that show consistent approach were identified.

scholarly journals EFEK INTERAKSI LITERASI KEUANGAN DALAM KEPUTUSAN INVESTASI: PENGUJIAN BIAS-BIAS PSIKOLOGI

2021 ◽  
Vol 10 (1) ◽  
pp. 36
Author(s):  
Wendy Wendy
Keyword(s):  
Financial Literacy ◽  
Investment Decisions ◽  
Interaction Model ◽  
Investor Behavior ◽  
Disposition Effect ◽  
Herding Behavior ◽  
Risky Investment ◽  
Managerial Implications ◽  
Comprehensive Manner ◽  
Positive Effect

                                                        ABSTRACTThis research aims to analyze psychological biases that occur when investors make risky investment decisions. There are five behavioral factors analyzed (herding, overconfidence, disposition effect, conservatism, and availability). Financial literacy is used as moderator in analyzing the effect of those bahaviors towards risky investment decisions. This research examines four econometric equations in explaining financial literacy as a moderator. Interaction effect testing is carried out using moderating variable regression. The results show that psychological biases occur in making risky investment decisions. Herding behavior, overconfidence, disposition effect, and conservatism show a positive effect, while availability does not show a significant effect. Testing on the interaction model finds that financial literacy is able to reduce these psychological biases. This finding also explains the managerial implications that investors with high levels of financial literacy have the potential to experience relatively low psychological biases compared to investors with limited levels of financial literacy. In terms of limitations, this research uses a questionnaire survey that has not been able to reveal aspects of investor behavior in a comprehensive manner. In addition, the number of respondents who are more dominated by beginner investors also adds to the limitations in carrying out the generalization.                                                    ABSTRAKRiset ini bertujuan untuk menganalisis bias-bias psikologi yang terjadi ketika pemodal mengambil keputusan investasi berisiko. Terdapat lima faktor perilaku yang dianalisis, yaitu perilaku herding, overconfidence, disposition effect, conservatism, dan availability. Literasi keuangan digunakan sebagai pemoderasi dalam menganalisis pengaruh faktor-faktor keperilakuan tersebut terhadap keputusan investasi berisiko. Riset ini menguji empat persamaan ekonometrika dalam menjelaskan peran literasi keuangan sebagai pemoderasi. Pengujian efek interaksi dilakukan dengan menggunakan regresi variabel moderasi. Hasil analisis menunjukkan bahwa bias-bias psikologi terjadi dalam pengambilan keputusan investasi berisiko. Perilaku herding, overconfidence, disposition effect, dan conservatism menunjukkan pengaruh positif terhadap pengambilan keputusan investasi berisiko, sementara bias availability tidak menunjukkan pengaruh yang bermakna dalam riset ini. Pengujian pada model interaksi menemukan bahwa literasi keuangan mampu mereduksi bias-bias psikologi tersebut. Temuan ini sekaligus menjelaskan implikasi manajerial bahwa pemodal dengan tingkat literasi keuangan yang baik berpotensi mengalami bias-bias psikologi yang relatif lebih rendah dibandingkan pemodal dengan tingkat lietrasi keuangan yang terbatas. Dari sisi keterbatasan, riset ini menggunakan survei kuesioner yang belum mampu mengungkap aspek perilaku pemodal secara komprehensif. Selain itu, jumlah responden yang lebih didominasi oleh pemodal pemula juga menambah keterbatasan dalam melakukan generalisasi hasil penelitian.

scholarly journals Can longer gaze duration determine risky investment decisions? An interactive perspective

2021 ◽  
Vol 14 (4) ◽  
Author(s):  
Yiheng Wang ◽  
Yanping Liu
Keyword(s):  
Diffusion Model ◽  
Investment Decisions ◽  
Expected Value ◽  
Current Experiment ◽  
Choice Process ◽  
The Gaze ◽  
Risky Investment ◽  
Underlying Mechanisms ◽  
Computational Difficulty ◽  
Decision Difficulty

Can longer gaze duration determine risky investment decisions? Recent studies have tested how gaze influences people’s decisions and the boundary of the gaze effect. The current experiment used adaptive gaze-contingent manipulation by adding a self-determined option to test whether longer gaze duration can determine risky investment decisions. The results showed that both the expected value of each option and the gaze duration influenced people’s decisions. This result was consistent with the attentional diffusion model (aDDM) proposed by Krajbich et al. (2010), which suggests that gaze can influence the choice process by amplify the value of the choice. Therefore, the gaze duration would influence the decision when people do not have clear preference.The result also showed that the similarity between options and the computational difficulty would also influence the gaze effect. This result was inconsistent with prior research that used option similarities to represent difficulty, suggesting that both similarity between options and computational difficulty induce different underlying mechanisms of decision difficulty.

scholarly journals Medicine Between Ethics and Scientific Progress: How Much Ethics Needs Medicine, how much ethics can it afford? Some Considerations from Patent Law Perspectives

2015 ◽  
Vol 8 (1) ◽  
pp. 47-76
Author(s):  
Joseph Straus
Keyword(s):  
New Technologies ◽  
Embryonic Stem ◽  
Scientific Progress ◽  
Modern Medicine ◽  
Patent Law ◽  
The European Union ◽  
Ethical Concerns ◽  
Legal Situation ◽  
Risky Investment

The progress of medicine is heavily dependent on the progress of science and technology, which in turn depend on costly and risky investment in research and development. In this contribution, based on some concrete examples, new scientific achievements are presented as basis of modern medicine and source of ethical concerns. Addressed are also the role of scientists in coping with safety in ethical concerns as regards hazards of new technologies, costs of R&D investment in drug development and the role of patents in this context. In some detail the legal situation existing at an international and European level as regards exclusions from patentability based on reasons of ethics and morals is presented. A critical appraisal of the case law of the Court of Justice of the European Union as regards patentability of embryonic stem cells is offered.

Influence of terror perceptions on individual investment behaviors: examining the moderating effects of present hedonic time perspective and consumer gender

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Jing-Yi Chen
Keyword(s):  
Decision Making ◽  
Sensation Seeking ◽  
Time Perspective ◽  
Low Ph ◽  
Investment Behavior ◽  
Content Type ◽  
Financial Investment ◽  
Time Perspectives ◽  
Risky Investment ◽  
Financial Investments

PurposeThe argument that terror perception and individual time perspectives can affect behaviors has become increasingly relevant. This study analyzed the association of terror perception with financial risk and developed an integrated framework of the interaction between terror perception (mortality salience) and time perspective to determine risky investment. People with different time perspectives have different acknowledgments of risk. Two studies of terror perception leading to more or less risky investment choices supported this framework to demonstrate that individuals exhibit more (less) risky investment behavior when terror perception is salient and they have a high (low) present hedonic time perspective.Design/methodology/approachTwo experiments were performed. Study 1 tested whether TP moderates the effects of terror priming (aging) on risky financial investment. Study 2 tested the effects of terror priming on risky financial investment decisions and the role of gender and the present hedonic TP (PH) in moderating these effects. The following hypotheses were then developed: H1: Participants with high PH primed with the aging condition will select riskier financial investments than those with low PH will (Study 1). H2: Male participants with higher PH primed in the death condition will select riskier financial investments than those in the control condition will (Study 2).FindingsBecause people with different TPs acknowledge risk differently, this article developed a new framework modeling MS on TP in risky investment selection. Two studies representative of MS affecting risky investment decision-making were conducted to test the framework. The results of the two studies indicated that individuals engaged in risky investment behavior more (less) when mortality was salient and the individual had high (low) PH. Moreover, gender influences these results. As anticipated, male participants with higher PH in the death-primed condition selected riskier financial investment than those in the control condition did. Additional research from a broader perspective is warranted.Originality/valueMany psychological factors of risky decision-making have been discussed, such as motivational systems or situational motivation, self-framing, control orientation, sensation seeking, dishonesty, and ambiguity (Sekścińska et al., 2016). However, few studies have examined temporal framing, also known as time perspective (TP), the psychological concept of a person's relationship with time. This study mainly discusses the effects of terror perception on risky financial decisions by using a theoretical framework based on TP, which influences the effects of MS on risky financial decision-making. When mortality is made salient, individuals with present hedonic TP have behaviors characterized by risk perception. Those with present hedonic TP are more likely to make risky financial investments because they prefer present pleasure and risk over future outcomes (Zimbardo and Boyd, 2015).

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