Study On The Difference And Formation Mechanism Of Loss Aversion From The Perspective Of Social Distance

Loss aversion is an important concept in risky decision making,which also widely exists in everyday life as well as influences the investment,consumption and medical decision making.Meanwhile,due to the social attribute of people and the convenient social interaction caused by Internet development,people often need to consider others'decision requirements,give suggestion and even make decisions on behalf of other people,such as:managers make strategic decisions for stockholders,portfolio managers recommend investment programs to investors,etc.When making decisions on behalf of others,different social distances between decision-makers and others will lead to decisions with different quality.Thus,investigating loss aversion difference in risky decision making from the perspective of social distance can help both sides enhance the trust between them and increase decision quality.There are several limitations in previous literature about self-other decision-making difference.Firstly,previous literature observes different give different results and thus give different explanations based on various theories.More specifically,some researchers found people are more conservative when they choosing for others;while some researchers found the opposite.Some papers found participants make different decisions for themselves and others only when losses are possible,however,others reported the opposite results.We found that previous studies used on limited types of risky decision-making tasks(mostly within the mixed domain),which could be the cause of the limitation and the contradiction of the results.Secondly,most of the previous literature only focuses on the phenomenon of the differences but lack the deeper exploration on the internal mechanism of decision-making difference,while the latter can help to better understand the micro-mechanism of the differences.Thirdly,feedback processing can provide more information to decision makers so as to update the cognition of loss aversion.Thus,feedback processing serves as an important stage of decision making.However,previous studies only focused on the valuation stage,leaving feedback processing stage unexplored.Based on the above theoretical and practical background,this paper mainly discusses the impact of social distance on loss aversion and its internal mechanism.The depictions of three main research problems in this paper are as follows:Question 1:in the valuation stage of decision making,how does social distance influence loss aversion level?Question 2:in the valuation stage of decision making,what is the cognitive processing mechanism of social distance influencing loss aversion level?Question 3:in the feedback processing stage of decision making,does the feedback with information update have an impact on the degree of loss aversion?Does the influence of social distance on loss aversion level still exist and what is its influence mechanism?In order to solve the above-mentioned research problems,behavioral experiment and cognitive neuroscience technology were effectively integrated to carry out the following three sub-studies:The first study is the foundation of this thesis,aiming to investigate the effect of social distance on loss aversion level in mixed type,gain type and loss type of risky decision making.By comparing the direct and indirect expressions of loss aversion under different social distances,the negative influence of social distance on loss aversion is proved,which added new evidence to the explanation theory about how social distance would influence loss aversion.The second study carries out a functional magnetic resonance imaging(fMRI)experiment to explore the internal mechanism of social distance influencing loss aversion in the valuation stage.Through the comparative analysis of Salient Networks(SN)and brain regions related to Theory of Mind(ToM),we find that the influence of social distance on loss aversion is non-linear at the level of neuroscience,that is,there is a boundary between decision-makers themselves and others.Focusing on the feedback processing stage of decision making,the last study adopts the event-related potential technology(ERPs)to explore the phenomenon and mechanism of social distance on loss aversion in the feedback processing stage.It is found that social distance influences the cognitive processing of feedback and then cause the loss aversion differences at the behavioral level.Finally,we construct a model which can predict the level of loss aversion with the perceptive value and attention-related brain signal.In conclusion,through behavior experiment,fMRI experiment and ERPs experiment,this paper clearly reveals the influence of social distance on loss aversion and its internal formation mechanism at each stage of risky decision making from the aspect of the phenomenon to the essence.This thesis improves the theoretical system of risk decision-making,provides a reference paradigm and data analysis method for the subsequent experimental research on loss aversion,and builds the theoretical foundation to provide guidance for specific situations in business management and daily life.