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3 years ago

Study reveals people take fewer risks when losses feel personal.

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Asset Integration, Risk Taking and Loss Aversion in the Laboratory
William Morrison, Robert J. Oxoby

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The experiment tested how people react to losing money compared to taking risks, using a special method to make the loss feel real. Results showed that individuals are more hesitant to take part in a risky lottery when faced with potential losses, even more than just being risk-averse. This means that people are more averse to losing money than they are to taking risks, which affects how they make decisions in uncertain situations.