Contagion Effect of Risk Preference under the Loss Frame and Its Potential Mechanism

Our attitude toward risk plays a crucial role in influencing our everyday decision-making. Studies have found that human risk-preference are susceptible to the frame in which options are presented (“framing effect”) and can be altered by observing and learning from others’ risk-related decisions (“risk contagion effect”). In this study, we seek to found out the effect of contagion in risk preference under the context of loss, using choice data and computational modeling.We demonstrated that individual’s risk-preference can be readily shifted after observing other’s choices, and this contagion effect are considerably stronger after observing a risk-averse agent than a risk-seeking one under the Loss frame. We also found the distance in risk preference between observer and observee positively influenced the degree of risk contagion. Taken together, these findings provide a mechanistic account for how observing others’ risky choices can modulate an individual’s own risk-preference.