Behavioral Biases and Firm Behavior : Evidence from Kenyan Retail Shops

Many subjects in lab experiments exhibit small-stakes risk aversion, consistent with loss aversion. Those with greater math skills are less likely to show small-stakes risk aversion. We argue that departures from expected utility maximization may help explain why many firms in developing countries l...

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Bibliographic Details
Main Authors:	Kremer, Michael, Lee, Jean, Robinson, Jonathan, Rostapshova, Olga
Format:	Journal Article
Language:	en_US
Published:	American Economic Association 2014
Subjects:	firm behavior risk uncertainty life cycle models saving capital budgeting manufacturing service industries
Online Access:	http://hdl.handle.net/10986/17930

id	okr-10986-17930
recordtype	oai_dc
spelling	okr-10986-179302021-04-23T14:03:41Z Behavioral Biases and Firm Behavior : Evidence from Kenyan Retail Shops Kremer, Michael Lee, Jean Robinson, Jonathan Rostapshova, Olga firm behavior risk uncertainty life cycle models saving capital budgeting manufacturing service industries Many subjects in lab experiments exhibit small-stakes risk aversion, consistent with loss aversion. Those with greater math skills are less likely to show small-stakes risk aversion. We argue that departures from expected utility maximization may help explain why many firms in developing countries leave high expected return investments unexploited. We show that among a sample of Kenyan shopkeepers, inventories are negatively associated with small-stakes risk aversion and positively associated with math skills. 2014-04-21T20:52:17Z 2014-04-21T20:52:17Z 2013-05 Journal Article American Economic Review 0002-8282 10.1257/aer.103.3.362 http://hdl.handle.net/10986/17930 en_US CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo American Economic Association American Economic Association Publications & Research :: Journal Article Kenya
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	en_US
topic	firm behavior risk uncertainty life cycle models saving capital budgeting manufacturing service industries
spellingShingle	firm behavior risk uncertainty life cycle models saving capital budgeting manufacturing service industries Kremer, Michael Lee, Jean Robinson, Jonathan Rostapshova, Olga Behavioral Biases and Firm Behavior : Evidence from Kenyan Retail Shops
geographic_facet	Kenya
description	Many subjects in lab experiments exhibit small-stakes risk aversion, consistent with loss aversion. Those with greater math skills are less likely to show small-stakes risk aversion. We argue that departures from expected utility maximization may help explain why many firms in developing countries leave high expected return investments unexploited. We show that among a sample of Kenyan shopkeepers, inventories are negatively associated with small-stakes risk aversion and positively associated with math skills.
format	Journal Article
author	Kremer, Michael Lee, Jean Robinson, Jonathan Rostapshova, Olga
author_facet	Kremer, Michael Lee, Jean Robinson, Jonathan Rostapshova, Olga
author_sort	Kremer, Michael
title	Behavioral Biases and Firm Behavior : Evidence from Kenyan Retail Shops
title_short	Behavioral Biases and Firm Behavior : Evidence from Kenyan Retail Shops
title_full	Behavioral Biases and Firm Behavior : Evidence from Kenyan Retail Shops
title_fullStr	Behavioral Biases and Firm Behavior : Evidence from Kenyan Retail Shops
title_full_unstemmed	Behavioral Biases and Firm Behavior : Evidence from Kenyan Retail Shops
title_sort	behavioral biases and firm behavior : evidence from kenyan retail shops
publisher	American Economic Association
publishDate	2014
url	http://hdl.handle.net/10986/17930
_version_	1764438724305747968

Behavioral Biases and Firm Behavior : Evidence from Kenyan Retail Shops

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