The Impact of Regret on the Demand for Insurance

By Michael Braun, Alexander Muermann. 2004

229 citations recorded by the source corpus.

How researchers see this paper

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Rationality of Choices in Subsidized Crop Insurance Markets (2017, unknown): “Braun and Muermann (2004) show that, in contrast to Mossin’s finding, underinsurance will arise under regret preferences even when the insurance contract is actuarially fair.”
Applying regret theory to investment choices: Currency hedging decisions (2008, unknown): “Braun and Muermann (2004) apply RT to demand for insurance, and Muermann et al.”
Decisions Under Uncertainty: Psychological, Economic, and Neuroeconomic Explanations of Risk Preference (2009, background): “Extending these ideas, Braun and Muermann (2004) proposed a formulation of regret theory that can be applied to decisions that have more than two possible choice options.”
Flood Insurance Coverage in the Coastal Zone (2011, unknown): “Variations in optimal coverage choice can also be explored through the introduction of different forms of utility in (1) (e.g. Braun and Muermann 2004; Lee 2007) or through defining utility over changes in wealth (Kahneman and Tversky 1979).”
Regret, Portfolio Choice, and Guarantees in Defined Contribution Schemes (2006, methodology): “0E [(Rg − R)(1+ kg0 (u(wmax) − u(w0 (1 + rf))))] (1 + rf)E [(1 + kg0 (u(wmax) − u(w0 (1 + rf))))] .( 8) Substituting (8) into ( 7 ) yields”