The Resource The role of intuition and reasoning in driving aversion to risk and ambiguity, Jeffrey Butler, Luigi Guiso and Tullio Japelli

The role of intuition and reasoning in driving aversion to risk and ambiguity, Jeffrey Butler, Luigi Guiso and Tullio Japelli

Label
The role of intuition and reasoning in driving aversion to risk and ambiguity
Title
The role of intuition and reasoning in driving aversion to risk and ambiguity
Statement of responsibility
Jeffrey Butler, Luigi Guiso and Tullio Japelli
Creator
Contributor
Author
Subject
Language
eng
Summary
Using information on a large sample of retail investors and experimental data we find that risk aversion and risk ambiguity are correlated: individuals who dislike risk also dislike ambiguity. We show that what links these traits is the way people handle decisions. Intuitive thinkers are less averse to risk and less averse to ambiguity than individuals who base their decisions on effortful reasoning. We confirm this finding in a series of experiments. One interpretation of our results is that the high-speed of intuitive thinking puts intuitive thinkers at a comparative advantage in situations involving high risk and ambiguity, making them less averse to both. Consistent with this view we show evidence from the field and from the lab that intuitive thinkers perform better than deliberative thinkers when making decisions in highly ambiguous and risky environments. We also find that attitudes toward risk and ambiguity are related to different individual characteristics and wealth. While the wealthy are less averse to risk, they dislike ambiguity more, a finding that has implications for financial puzzles
Member of
Cataloging source
IT-FiEUI
http://library.link/vocab/creatorName
Butler, Jeffrey
Index
no index present
Literary form
non fiction
http://library.link/vocab/relatedWorkOrContributorName
  • Guiso, Luigi
  • Japelli, Tullio
  • European University Institute
Series statement
  • EUI working papers. ECO
  • EUI papers
Series volume
2011/13
http://library.link/vocab/subjectName
  • Risk-taking (Psychology)
  • Ambiguity
Label
The role of intuition and reasoning in driving aversion to risk and ambiguity, Jeffrey Butler, Luigi Guiso and Tullio Japelli
Link
http://hdl.handle.net/1814/17195
Instantiates
Publication
Note
Keywords: Risk Aversion; Risk Ambiguity; Decision Theory; Dual Systems; Intuitive Thinking; D81; D83
Bibliography note
Includes bibliographical references (pages 26-29) and index
Carrier category
volume
Carrier category code
  • nc
Carrier MARC source
rdacarrier.
Content category
text
Content type code
  • txt
Content type MARC source
rdacontent.
Control code
FIEb1697072x
Dimensions
30 cm.
Extent
46 pages
Media category
unmediated
Media MARC source
rdamedia.
Media type code
  • n
Other physical details
illustrations
System control number
(OCoLC)772961877
Label
The role of intuition and reasoning in driving aversion to risk and ambiguity, Jeffrey Butler, Luigi Guiso and Tullio Japelli
Link
http://hdl.handle.net/1814/17195
Publication
Note
Keywords: Risk Aversion; Risk Ambiguity; Decision Theory; Dual Systems; Intuitive Thinking; D81; D83
Bibliography note
Includes bibliographical references (pages 26-29) and index
Carrier category
volume
Carrier category code
  • nc
Carrier MARC source
rdacarrier.
Content category
text
Content type code
  • txt
Content type MARC source
rdacontent.
Control code
FIEb1697072x
Dimensions
30 cm.
Extent
46 pages
Media category
unmediated
Media MARC source
rdamedia.
Media type code
  • n
Other physical details
illustrations
System control number
(OCoLC)772961877

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