Self–Other Decision Making and Loss Aversion

Abstract: In eight studies, we tested the prediction that making choices for others involves less loss aversion than making choices for the self. We found that loss aversion is significantly lessened among people choosing for others in scenarios describing riskless choice (Study 1), gambling (Studies 2 and 3), and social aspects of life, such as likeably and status (Studies 4a–e). Moreover, we found this pattern in relatively realistic conditions where people are rewarded for making desirable (i.e., profitable) choices for others (Study 2), when the other for whom a choice is made is physically present (Study 3), and when real money is at stake (Studies 2 and 3). Finally, we found loss aversion is moderated when factors associated with self–other differences in decision making are taken into account, such as decision makers’ construal level (Study 4a), regulatory focus (Study 4b), degree of information seeking (Study 4c), omission bias (Study 4d), and power (Study 4e).

Reference Information

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Method(s) Used in Paper

Behavior Identification Form

by Robin Vallacher and Daniel Wegner.
Published in "Journal of Personality and Social Psychology" in 1989.

Sense of Power Scale

by Adam Galinsky and Cameron Anderson.
Published in "European Journal of Social Psychology" in 2006.

APA-Format Citation

Polman, E. (2012). Self–other decision making and loss aversion. Organizational Behavior and Human Decision Processes, 119(2), 141-150.