The “Fear of Missing Out” or FoMO has become an accepted motivator of behaviours extending from the purchase of limited-edition sneaker brands to social media use and cryptocurrency investment. As a motivator of individual financial behaviours, such as cryptocurrency and stock investment, it is unclear how FoMO relates to consumer financial literacy and other consumer traits, including risk tolerance and personality. We propose, and assess, a model of reported investment behaviour and investment behaviour intention. We find a larger association between FoMO and crypto ownership, both current and intended, compared with stocks. FoMO has a small association with current stock ownership, relative to the association of financial literacy and risk tolerance. Context matters when measuring FoMO with the more context-specific measures having the largest associations with investment behaviour and investment intentions. Finally, our results suggest financial literacy is an antecedent of FoMO, more so for stocks.

Research has shown that risk tolerance increases when multiple decisions and associated outcomes are presented together in a broader “bracket” rather than one at a time. The present studies disentangle the influence of problem bracketing (presenting multiple investment options together) from that of outcome bracketing (presenting the aggregated outcomes of multiple decisions), factors which have been deliberately confounded in previous research. In the standard version of the bracketing task, in which participants decide how much of an initial endowment to invest into each in a series of repeated, identical gambles, we find a problem bracketing effect but not an outcome bracketing effect. However, this pattern of results does not generalize to the cases of non-identical gambles nor discrete choice, where we fail to find the standard bracketing effect.

Risk is endemic to the political arena and influences citizen engagement. We explore this connection by suggesting that risk-taking may be biologically instantiated in sensory systems. With specific attention to gender and gender identity, we investigate the connections between self-reported bitter taste reception, risk tolerance, and both of their associations with political participation. In three U.S. samples collected in 2019 and 2020, participants were asked to rate their preferences from lists of foods as well as whether they detected the taste of the substance N-Propylthiouracil (PROP) and, if so, the strength of the taste. In this registered report, we find that self-reported bitter taste preference, but not PROP detection, is positively associated with higher levels of risk tolerance as well as political participation. The pattern with gender and gender identity is mixed across our samples, but interestingly, we find that sex-atypical gender identity positively predicts political participation.

In this paper we consider a reinsurance syndicate, assuming that Pareto optimal allocations exist. Under a continuity assumption on preferences, we show that a competitive equilibrium exists and is unique. Our conditions allow for risks that are not bounded, and we show that the most standard models satisfy our set of sufficient conditions, which are thus not restrictive. Our approach is to transform the analysis from an infinite dimensional to a finite dimensional setting.

This study examines the practical application of a system for the derivation of member utility functions for the purpose of recommending investment-channel choice to members of a defined-contribution retirement fund. The utility functions of post-retirement benefits from members of a defined-contribution fund are elicited. The risk aversion of each member is measured and the results are compared with a standard risk-tolerance assessment method.

This paper attempts to give an overview of the pricing of risks in a pure exchange economy, where trade takes place at time zero and where uncertainty is revealed at time one. An economic equilibrium model under uncertainty is formulated, where conditions characterizing a Pareto optimal exchange equilibrium are derived. We present two sets of sufficient conditions for the existence of an equilibrium, and demonstrate how equilibria can be characterized through several examples. Uniqueness of equilibrium is also discussed. Special attention is given to the principal components that the premiums in a reinsurance market must depend upon. We also apply the general theory to the risk exchange problem between a policyholder and an insurer, and in particular we compute market premiums of the resulting optimal contracts.

It is emphasized throughout how the formulation of a competitive equilibrium, rather than merely a general risk exchange formulation, is of particular interest in deriving a well-defined and unique set of equilibrium premiums in an insurance market. The theory is put into a framework which is fruitful for extensions beyond the one-period case.