Risk preference discrepancy : a prospect relativity account of the discrepancy between risk preferences in laboratory gambles and real world investments

In this article, we presented evidence that people are more risk averse when investing in financial products in the real world than when they make risky choices between gambles in laboratory experiments. In order to provide an account for this discrepancy, we conducted experiments, which showed that the range of offered investment funds that vary in their riskreward characteristics had a significant effect on the distribution of hypothetical funds to those products. We also showed that people are able to use the context provided by the choice set in order the make relative riskiness judgments for investment products. This context dependent relativistic nature of risk preferences is proposed as a plausible explanation of the risk preference discrepancy between laboratory experiments and real-world investments. We also discuss other possible theoretical interpretations of the discrepancy

Dimensionality of risk perception : factors affecting consumer understanding and evaluation of financial risk

This article describes two studies of the factors affecting consumer understanding of financial risk. The first study investigated factors affecting people's perception and comprehension of information about the risks related to retirement investments. First, we asked respondents to list possible risk factors related to investment in a pension plan. Then we obtained ratings of different factors (e.g., the perceived level of knowledge about an investment) that could affect perception of the risk of financial products and retirement investment decisions. Finally, we asked the subjects to rate 11 different descriptions presenting risk information about the same financial product. The risk information framing that received highest rating presented risk as variation between minimum and maximum values with an average in between. The second study demonstrated the risk framing that received highest ranking also prompted more stable risk preferences over a 3-month testing period in comparison to standard measures of risk aversion. Thus, the second study corroborated the importance of the findings in the first study and also indicated that, although people can exhibit stable risk preferences if we ask them the right questions, these preferences were very specific to the risk domain

CFD modelling of two-phase stirred bioreaction systems by segregated solution of the Euler–Euler model

An advanced study of a bioreactor system involving a Navier–Stokes based model has been accomplished. The model allows a more realistic impeller induced flow image to be combined with the Monod bioreaction kinetics reported previously. The time-course of gluconic acid production by Aspergillus niger strain is simulated at kinetic conditions proposed in the literature. The simulation is based on (1) a stepwise solution strategy resolving first the fluid flow field, further imposing oxygen mass transfer and bioreaction with subsequent analysis of flow interactions, and (2) a segregated solution of the model replacing the multiple iterations per grid cell with single iterations. The numerical results are compared with experimental data for the bioreaction dynamics and show satisfactory agreement. The model is used for assessment of the viscosity effect upon the bioreactor performance. A 10-fold viscosity rise results in 2-fold decrease of KLa and 25% decrease of the specific gluconic acid production rate. The model allows better understanding of the mechanism of the important bioprocess

Relativistic financial decisions : context effects on retirement saving and investment risk preferences

We report a study of the effects the choice set on financial decision making related to retirement savings and risky investment. The participants were presented with either a full range of choice options or a limited subset of the feasible options. The choices of saving and risk are affected by the position of each option in the range of presented options. This result demonstrated that the range of the options offered as possible saving rates and levels of investment risk influences decisions about saving and risk. The study was conducted on a sample of working people, and we controlled whether the participants can financially afford in their real life the decisions taken in the test. In addition, various measures of risk aversion did not account for the risk taken in each condition. Surprisingly, only the simplest and most direct risk preference measure was a significant predictor of the responses within a particular choice set context, although the actual choices were still very much influenced by the range. Thus, the results reported here suggest that financial judgments and choices are relative, which corroborates, in an important practical domain, previous related work with abstract gambles and hypothetical risky investments

Monetary cost for time spent in everyday physical activities.

publisher: Elsevier articletitle: Monetary cost for time spent in everyday physical activities journaltitle: Social Science & Medicine articlelink: http://dx.doi.org/10.1016/j.socscimed.2014.02.043 content_type: article copyright: Copyright © 2014 Elsevier Ltd. All rights reserved.publisher: Elsevier articletitle: Monetary cost for time spent in everyday physical activities journaltitle: Social Science & Medicine articlelink: http://dx.doi.org/10.1016/j.socscimed.2014.02.043 content_type: article copyright: Copyright © 2014 Elsevier Ltd. All rights reserved.We measured utility curves for the hypothetical monetary costs as a function of time engaged in three everyday physical activities: walking, standing, and sitting. We found that activities requiring more physical exertion resulted in steeper discount curves, i.e., perceived cost as a function of time. We also examined the effects of gain vs. loss framing (whether the activity brought additional rewards or prevented losses) as well as the effects of the individual factors of gender, income, and BMI. Steeper discount curves were associated with higher income (annual household ≥ median of $45,000) and gain framing (which indicates loss aversion). There were interactions between gender and frame, and also income and frame: Females and higher income participants showed loss aversion whereas males and lower income participants were not affected by framing. Males showed less discounting in gain frames relative to females, whereas females showed less discounting in loss frames relative to males. In gain frames, higher income participants discounted more but in loss frames there was no effect of income. We also found individual tendencies for discounting across activities: if an individual exhibited steeper discounting for one activity, they were also more likely to exhibit steeper discounting for the other activities. These results have implications for designers of interventions to encourage non-exercise physical activities, suggesting that loss-framed incentives are more effective for women and those with middle class (or greater) incomes. Furthermore loss framed incentives have more uniform impact across income brackets because people discount loss frames similarly regardless of income whereas those with middle-class incomes are not as motivated by gain frames. Our results also demonstrate a general method for examining the costs of effort associated with everyday activities

Theorem on the proportionality of inertial and gravitational masses in classical mechanics

We considered the problem of the proportionality of inertial and gravitational masses in classical mechanics. We found that the kinetic energy of a material mass point m in a circular motion with a constant angular velocity around another material point M depends only on its gravitational mass. This fact, together with the known result that the straight line is a circumference with an infinite radius, allowed us to prove the proportionality between the inertial and gravitational masses.Comment: ReVTeX file, 10p

Double (implicit and explicit) dependence of the electromagnetic field of an accelerated charge on time: Mathematical and physical analysis of the problem

We considered the electromagnetic field of a charge moving with a constant acceleration along an axis. We found that this field obtained from the Li\'enard-Wiechert potentials does not satisfy Maxwell equations if one considers exclusively a retarded interaction (i.e. pure implicit dependence this field on time). We show that if and only if one takes into account both retarded interaction and direct interaction (so called "action-at-a-distance") the field produced by an accelerated charge satisfies Maxwell equations.Comment: ReVTeX file, no figures, 12p