Risk Aversion and Emotions

Y. Nguyen, C.N. Noussair

Research output: Working paperDiscussion paperOther research output

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Abstract

Abstract: We consider the relationship between emotions and decision-making under risk. Specifically, we examine the emotional correlates of risk-averse decisions. In our experiment, individuals' facial expressions are monitored with facereading software, as they are presented with risky lotteries. We then correlate these facial expressions with subsequent decisions in risky choice tasks. We find that the valence of one’s emotional state is negatively correlated, and the strength of a number of emotions: fear, happiness, anger, and surprise, is positively correlated, with risk-averse decisions.
Original languageEnglish
Place of PublicationTilburg
PublisherEconomics
Number of pages21
Volume2013-041
Publication statusPublished - 2013

Publication series

NameCentER Discussion Paper
Volume2013-041

Fingerprint

Emotion
Risk aversion
Correlates
Risk-averse
Lottery
Decision making under risk
Happiness
Valence
Experiment
Risky choice
Software
Surprise
Anger

Keywords

  • Risk aversion
  • emotions
  • facereading
  • fear

Cite this

Nguyen, Y., & Noussair, C. N. (2013). Risk Aversion and Emotions. (CentER Discussion Paper; Vol. 2013-041). Tilburg: Economics.
Nguyen, Y. ; Noussair, C.N. / Risk Aversion and Emotions. Tilburg : Economics, 2013. (CentER Discussion Paper).
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Nguyen, Y & Noussair, CN 2013 'Risk Aversion and Emotions' CentER Discussion Paper, vol. 2013-041, Economics, Tilburg.

Risk Aversion and Emotions. / Nguyen, Y.; Noussair, C.N.

Tilburg : Economics, 2013. (CentER Discussion Paper; Vol. 2013-041).

Research output: Working paperDiscussion paperOther research output

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N2 - Abstract: We consider the relationship between emotions and decision-making under risk. Specifically, we examine the emotional correlates of risk-averse decisions. In our experiment, individuals' facial expressions are monitored with facereading software, as they are presented with risky lotteries. We then correlate these facial expressions with subsequent decisions in risky choice tasks. We find that the valence of one’s emotional state is negatively correlated, and the strength of a number of emotions: fear, happiness, anger, and surprise, is positively correlated, with risk-averse decisions.

AB - Abstract: We consider the relationship between emotions and decision-making under risk. Specifically, we examine the emotional correlates of risk-averse decisions. In our experiment, individuals' facial expressions are monitored with facereading software, as they are presented with risky lotteries. We then correlate these facial expressions with subsequent decisions in risky choice tasks. We find that the valence of one’s emotional state is negatively correlated, and the strength of a number of emotions: fear, happiness, anger, and surprise, is positively correlated, with risk-averse decisions.

KW - Risk aversion

KW - emotions

KW - facereading

KW - fear

M3 - Discussion paper

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BT - Risk Aversion and Emotions

PB - Economics

CY - Tilburg

ER -

Nguyen Y, Noussair CN. Risk Aversion and Emotions. Tilburg: Economics. 2013. (CentER Discussion Paper).