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Contribution Details

Type Journal Article
Scope Discipline-based scholarship
Title The effect of paper outcomes versus realized outcomes on subsequent risk-taking: Field evidence from casino gambling
Organization Unit
  • Raphael Flepp
  • Philippe Meier
  • Egon Franck
Item Subtype Original Work
Refereed Yes
Status Published in final form
  • English
Journal Title Organizational Behavior and Human Decision Processes
Publisher Elsevier
Geographical Reach international
ISSN 0749-5978
Volume 165
Page Range 45 - 55
Date 2021
Abstract Text We test the realization effect, i.e., that risk-taking is greater after paper outcomes than after realized outcomes, using gambling data from a real casino. During a particular casino visit, customers likely perceive that gains and losses are paper outcomes, whereas leaving the casino realizes the final account balance. Using individual-level slot machine gambling records, we find that risk-taking after both paper losses and paper gains increases within a visit and that this effect is more pronounced for larger outcomes. Conversely, realized losses from earlier visits significantly decrease risk-taking if losses are comparatively large, whereas comparatively small realized losses and realized gains do not alter risk-taking. These results provide important field validation of the realization effect in an environment with positively skewed lotteries.
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Related URLs
Digital Object Identifier 10.1016/j.obhdp.2021.04.003
Other Identification Number merlin-id:21064
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