Difference between revisions of "Loss aversion"

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(Created page with '{{wikilink}} Loss aversion is risk aversion's evil twin. A loss-averse agent tends to avoids uncertain gambles, not because every unit of money brings him a bit less utility...')
 
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Loss aversion is [[risk aversion]]'s evil twin. A loss-averse agent tends to avoids uncertain gambles, not because every unit of money brings him a bit less utility, but because he weighs losses more heavily than gains, always treating his current level of money as somehow special.
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Loss aversion is [[risk aversion]]'s evil twin. A loss-averse agent tends to avoid uncertain gambles, not because every unit of money brings him a bit less utility, but because he weighs losses more heavily than gains, always treating his current level of money as somehow special.
  
 
==See also==
 
==See also==

Revision as of 19:29, 30 August 2009

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Loss aversion is risk aversion's evil twin. A loss-averse agent tends to avoid uncertain gambles, not because every unit of money brings him a bit less utility, but because he weighs losses more heavily than gains, always treating his current level of money as somehow special.

See also