A reverse sunk cost effect in risky decision making: Sometimes we have too much invested to gamble

The sunk cost effect refers to the empirical finding that people tend to let their decisions be influenced by costs made at an earlier time in such a way that they are more risk seeking than they would be had they not made these costs. This finding seems to be in conflict with economic theory which implies that only incremental costs and benefits should affect decisions. The effect is often explained in terms of prospect theory of (Kahneman, D., Tversky, A., 1979. Prospect theory: An analysis of decision under risk. Econometrica 47, 263–291), suggesting that sunk costs may induce a ‘loss frame,’ consequently causing risk seeking behavior. We argue that sunk costs may also result in risk aversion. In the present study we investigated the effect of time and effort investments (Behavioral Sunk Costs) on risky decision making in gain and loss situations. The results show that, in agreement with prospect theory, participants were more risk averse in gain situations than in loss situations. Moreover, incurring Behavioral Sunk Costs appeared to increase risk aversive choices, i.e., a reverse sunk cost effect. Furthermore, the results suggest that, in loss situations, Behavioral Sunk Costs mainly lead to risk aversive behavior if opting for the ‘safe’ alternative is not accompanied by an increased possibility to regret the decision.     

Multiple reference points in investor regret

Regret is the result of a comparison between “what is” and “what might have been”. Although regret is a relevant emotion in the life of investors, research studying the regrets of real investors and how these are influenced by multiple reference points is lacking. We present a field survey that investigated the regrets of real stock investors in relation to multiple “what might have been’s.” We found that their regrets are most influenced by what their outcomes might have been had they not invested, by their expected outcomes and by the best-performing unchosen stocks. In addition, we also found that the feeling of regret was influenced by losses or gains relative to each reference point rather than by the size of the loss or gain.     

Mutual workers'insurance: A historical outline

This article focuses on the historical development of small workers'mutual insurance societies whose members manage the fund themselves. The article begins by describing the remarkable similarities in terms of characteristics and development of these societies in different places and periods. It then discusses various non-directly democratic competitors in the field of social insurance and forms of State intervention. Finally, the article attempts to explain why competition from the private sector and State interventions forced directly democratic societies to choose between bureaucratization, marginalization and disbandment.     

Some computational problems related to multinomial trials

Efficient numerical algorithms are developed to evaluate several probabilities related to multinomial trials.In the first part of the paper, the probability distribution of the number of trials until the alternatives j, j = 1,… m, have occurred at least i_j times is computed. The multinomial trials involve the m alternatives l,…, m, with positive probabilities P_l-P_m of occurrence. In the second part, several aspects of a multinomial subset selection problem, discussed by S. S. Gupta and K. Nagel, are investigated.     

Changes in preschool children’s social engagement positively predict changes in social competence: A three‐year longitudinal study of portuguese children

To test the hypothesis that social engagement is a foundational aspect of other peer social competence indicators during early childhood, 160 Portuguese preschool children (“3‐year‐olds”) were observed at least in two different school years, using a battery of validated social competence assessments based on direct observations and child interviews. Multilevel growth models tested whether social engagement predicted initial values and linear changes in the other social competence indicators. Results were consistent with the hypothesis, insofar as both initial values and changes in social engagement significantly predicted initial values and changes in other social competence indicators. Additionally, the number of children's reciprocated friendships was also predicted by social engagement. These results are discussed from the perspectives of conceptual frameworks that consider individual differences in social competence during early childhood as a consequence of attachment histories and/or emotional competence.     

Principal stratum strategy: Potential role in drug development

A randomized trial allows estimation of the causal effect of an intervention compared to a control in the overall population and in subpopulations defined by baseline characteristics. Often, however, clinical questions also arise regarding the treatment effect in subpopulations of patients, which would experience clinical or disease related events post-randomization. Events that occur after treatment initiation and potentially affect the interpretation or the existence of the measurements are called intercurrent events in the ICH E9(R1) guideline. If the intercurrent event is a consequence of treatment, randomization alone is no longer sufficient to meaningfully estimate the treatment effect. Analyses comparing the subgroups of patients without the intercurrent events for intervention and control will not estimate a causal effect. This is well known, but post-hoc analyses of this kind are commonly performed in drug development. An alternative approach is the principal stratum strategy, which classifies subjects according to their potential occurrence of an intercurrent event on both study arms. We illustrate with examples that questions formulated through principal strata occur naturally in drug development and argue that approaching these questions with the ICH E9(R1) estimand framework has the potential to lead to more transparent assumptions as well as more adequate analyses and conclusions. In addition, we provide an overview of assumptions required for estimation of effects in principal strata. Most of these assumptions are unverifiable and should hence be based on solid scientific understanding. Sensitivity analyses are needed to assess robustness of conclusions.     

Applying the capability approach to policy-making: The impact assessment of the EU-proposal on organ donation

We show that the capability approach can greatly facilitate ex ante policy evaluations, in particular those that are geared towards multiple goals. It enables a structured discussion on policy benefits, distributional issues, freedom and ethics. We illustrate our general ideas with a real-world application: the impact assessment of an EU-proposal on organ donation.     

A pragmatic adaptive enrichment design for selecting the right target population for cancer immunotherapies

One of the challenges in the design of confirmatory trials is to deal with uncertainties regarding the optimal target population for a novel drug. Adaptive enrichment designs (AED) which allow for a data-driven selection of one or more prespecified biomarker subpopulations at an interim analysis have been proposed in this setting but practical case studies of AEDs are still relatively rare. We present the design of an AED with a binary endpoint in the highly dynamic setting of cancer immunotherapy. The trial was initiated as a conventional trial in early triple-negative breast cancer but amended to an AED based on emerging data external to the trial suggesting that PD-L1 status could be a predictive biomarker. Operating characteristics are discussed including the concept of a minimal detectable difference, that is, the smallest observed treatment effect that would lead to a statistically significant result in at least one of the target populations at the interim or the final analysis, respectively, in the setting of AED.