Loss Aversion and Individual Characteristics

Katrine Hjorth, Mogens Fosgerau

    Research output: Contribution to journalJournal articleResearchpeer-review


    Many studies have shown that loss aversion affects the valuation of non-market goods. Using stated choice data, this paper presents an empirical investigation of how individual-level loss aversion varies with observable personal characteristics and with the choice context. We investigate loss aversion with respect to travel time and money, and find significant loss aversion in both dimensions. The degree of loss aversion in the time dimension is larger than in the money dimension, and depends on age and education. Subjects tend to be more loss averse when the reference is well established.
    Original languageEnglish
    JournalEnvironmental and Resource Economics
    Pages (from-to)573-596
    Publication statusPublished - 2011


    • Stated preference data
    • Loss aversion
    • Fixed effects logit estimator
    • Discrete choice model
    • Non-market goods


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