The Emotional Information Processing System is Risk Averse: Ego-Depletion and Investment Behavior
Two experiments show that a shortage of self-regulatory resources results in more risk aversion in mixed-gamble (gain/loss) situations. The findings support a dual process view that distinguishes between a rational and an affective information processing system, in which self-regulatory resources are the necessary fuel for the rational system. Depending on the expected values of risk seeking versus risk averse behavior, ego depletion can have negative (experiment 1) as well as positive (experiment 2) consequences for investment behavior.
|Keywords||ego depletion, emotional information processing system, investment behavior, risk averse|
|JEL||C44, Statistical Decision Theory; Operations Research (jel), G11, Portfolio Choice; Investment Decisions (jel), G14, Information and Market Efficiency; Event Studies (jel), M, Business Administration and Business Economics; Marketing; Accounting (jel), M31, Marketing (jel)|
|Publisher||Erasmus Research Institute of Management (ERIM)|
de Langhe, B, Sweldens, S.T.L.R, van Osselaer, S.M.J, & Tuk, M.A. (2008). The Emotional Information Processing System is Risk Averse: Ego-Depletion and Investment Behavior (No. ERS-2008-064-MKT). ERIM report series research in management Erasmus Research Institute of Management. Erasmus Research Institute of Management (ERIM). Retrieved from http://hdl.handle.net/1765/13614