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| Jaroslava Hlouskova and Panagiotis Tsigaris |
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| ''The role of the marginal rate of substitution of wealth for a loss averse investor'' |
| ( 2016, Vol. 36 No.4 ) |
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| The marginal rate of substitution and the relative prices of goods have been used in economics to explain household's behavior but they have not been used yet in the behavioral economics literature. This note attempts to fill the gap in the literature with an application to a loss averse investor's demand for a risky asset in a one period model. |
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| Keywords: Loss Aversion, Reference Level, Marginal Rate of Substitution, Market trade-off, Risky Asset |
JEL:
D1 - Household Behavior: General |
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| Manuscript Received : Jun 09 2014 | | Manuscript Accepted : Nov 27 2016 |
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