Printer Friendly

Effects of self-esteem level on risk preference in different tasks.

When Shubik (1971) invented the dollar auction game, he found that it involved a motivation conversion phenomenon. At the beginning of the auction, the aim of the bidders is to obtain higher financial rewards. However, when the bid price is more than $1, the primary motivation of the bidders changes to beat their competitors or save their own face. Zhang (2009) presented an exchange theory of money and self-esteem in decision making, based on the findings in a series of previous experimental studies. Money and self-esteem (SE) have utility characteristics that cannot replace each other, so when they are in conflict, competition ensues. Previous researchers mostly focused on the relationship between money and SE (Costea, Palos, & Munteanu, 2010), ignoring the effects of SE level on risk preference. In the two experiments we conducted in this study, we examined the effects of SE level on risk preference. We explored the effects of an individual's SE level on risk preference in a monetary auction in a man to man behavioral experiment in Experiment 1. We then conducted a man to computer behavioral experiment using a revised gambling game in which we conducted a further examination of the effects in an Ellsberg paradox set-up.

Experiment 1

Method

Participants and Procedure. We adopted a 3 (self-esteem level: high/ moderate/low) x 2 (gender: male/female) between-subjects design. Participants comprised 60 Chinese undergraduate students (30 men, 30 women) aged from 19 to 22 years (M = 20.83, SD = 1.08), who had not heard about the experiment. We divided them into 15 groups of four people, with two men and two women in each group. We selected the individuals for the groups according to level of self-esteem, which we had measured using the Chinese version (Yang & Zhang, 1998) of Rosenberg's Self-Esteem Scale (SES; 1965). The scale consists of 10 items, with each item scored from 0 = strongly disagree to 3 = strongly agree. The Cronbach's [alpha] is 0.842.

We then told the students that they would be engaging in a real auction game. Before the auction we distributed 30 yuan in RMB (approximately US$5) to each participant as start-up capital. The auction items were valued at 1 yuan (approximately US$0.16), 2 yuan, 5 yuan, and 10 yuan in RMB, respectively. The starting prices and the minimum increasing amount were the same in each round. They were 1 jiao (one-tenth of a yuan), 2 jiao, 5 jiao, and 1 yuan, respectively. The two people who offered the highest and second highest price would give the equivalent amount of money that they called out to the experimenter. However, only the person who offered the highest price received the auction item. As the index of risk preference we proposed the concept of the bidding ratio, that is, the difference between the final bidding price of each participant and the absolute rational values divided by the minimum added value in each round of the auction. For example when the value of the auction item is 1 yuan, the minimum added value is 0.1 yuan. If a bidder no longer continues to increase his/her price bid at 0.8 yuan, then his/her bidding ratio is (0.8-1)/0.1 = -2 in the current round of auction. If a bidder does not give any price in an auction round, then his/her bid price is 0, and the bid ratio is (0-1)/0.1 = -10. The bidding ratio reflects the relative distance between the final bidding price and the absolute rational values, so it is not influenced by the absolute value of the auction item.

Results

The averages and standard deviations (in parentheses) of the bidding ratio were for men -4.00 (6.89) for low self-esteem (SE), -1.36 (11.87) for moderate SE, and -2.47 (7.56) for high SE. For women, the averages were -3.92 (7.63) for low SE, 2.25 (12.52) for moderate SE, and -3.90 (5.79) for high SE. A two-way analysis of variance (ANOVA) on the contribution amount showed that the participants' SE level had a significant main effect, F(2, 54) = 5.099, p = .009, and that the members of the moderate SE group were significantly more likely to take a risk than were those of the other two groups. The main effect of the gender of the bidders was not significant, F(1, 55) = 0.384, p = .538, and the interaction between SE level and gender was not significant, F(2, 54) = 1.474, p = .238.

Experiment 2

Method

Participants and Procedure. To further test the results of Experiment 1, we replaced the auction task used in the first experiment with a gambling task, but we still employed a 3 (self-esteem level: high/moderate/low) x 2 (gender: male/female) between-subjects design. Participants comprised 91 Chinese undergraduate students (45 men, 46 women) aged from 19 to 32 years (M = 22.46, SD = 0.28). We selected our groups in the same way as in Experiment 1. None of the students who took part in this experiment had participated in Experiment 1, nor had they heard of either the SES or the Ellsberg paradox before the experiment.

The participants then played a gambling game developed with E-Prime software. Participants saw two pictures on the screen at each trial, and their task was to choose between a risky option on the left picture and a fixed option on the right picture. The left picture had three treatments): card-deck treatment, knowledge treatment, and informed opponent treatment (Hsu, Bhatt, Adolphs, Tranel, & Camerer, 2005). For the left picture, participants got a higher sum of money for a bet on these treatments (e.g., 10 yuan) if the participant won the gamble, and zero otherwise. The sum of money for the right picture (fixed option) was constant in each of the trials of the treatments, but each of the three treatments yielded a different sum (e.g., 3 yuan). Every participant completed 24 trials in one treatment after 2 trials for practice. We proposed that the number of times that the left picture was selected, as a percentage, represented the index of risk preference.

Results

The averages and standard deviations (in parentheses) of the level of risk expressed as a percentage were for men .59 (.18) for low SE, .72 (.16) for moderate SE, and .57 (.16) for high SE. For women, the averages were .67 (.23) for low SE, .82 (.13) for moderate SE, and .68 (.23) for high SE. A two-way ANOVA on the contribution amount showed that the SE level had a significant main effect, F(2, 91) = 6.04, p = .004, and the members of the moderate SE group took significantly more risks than did those in the other two groups. The main effect of gender was also significant, F(1, 91) = 5.86, p = .018, but the interaction between SE level and gender was not significant, F(2, 91) = .035, p = .965.

Discussion

In both experiments we found that participants' self-esteem level had a significant effect on their risk preference. To some extent the results support the findings of Shubik (1971) and Zhang (2009). The participants who had moderate SE showed a higher risk preference than both the high and low SE participants. This implies that more attention should be paid to people with moderate SE as, because they represent the majority, this group may influence the developing way of the society.

Although the gender of the participants had no influence on their risk preference in the first experiment, it did in the second experiment. Gender did not interact with SE in any of the tasks, and the results showed that women were more likely to choose risky options than were men. This result is not consistent with previous relevant findings (Wieland & Sarin, 2011). The reason may be that risk preference and SE are not only a stable personality trait that is related to gender (Meier, Orth, Denissen, & Kuhnel, 2011), but risk preference can be affected by some situational factors and, thus, may be different in different situations (e.g., the different tasks). Therefore, in addition to the different tasks we investigated in our study, other situational factors require further exploration in future research.

http://dx.doi.org/10.2224/sbp.2013.41.5.815

References

Costea, I., Palos, R., & Munteanu, A. (2010). Competitive behavior and self esteem--Relevant factors that influence young couples' life. Procedia--Social and Behavioral Sciences, 5, 398-402. http:// doi.org/crvbzj

Hsu, M., Bhatt, M., Adolphs, R., Tranel, D., & Camerer, C. F. (2005). Neural systems responding to degrees of uncertainty in human decision-making. Science, 310, 1680-1683. http://doi.org/ bj6vkz

Meier, L. L., Orth, U., Denissen, J. J. A., & Kuhnel, A. (2011). Age differences in instability, contingency, and level of self-esteem across the life span. Journal of Research in Personality, 45, 604-612. http://doi.org/bbtc49

Rosenberg, M. (1965). Society and the adolescent self-image. Princeton, NJ: Princeton University.

Shubik, M. (1971). The dollar auction game: A paradox in noncooperative behavior and escalation. Journal of Conflict Resolution, 15, 109-111. http://doi.org/d8rd5x

Wieland, A., & Sarin, R. (2011). Domain specificity of sex differences in competition. Journal of Economic Behavior & Organization, 83, 151-157. http://doi.org/d3zwng

Yang, Y. Y., & Zhang, Z. X. (1998). Overview of measurements for personality and social psychology. Taipei: Yuan-Liu Press (Translated from Measures of personality and social psychological attitudes, J. P. Robinson, P. R. Shaver, & L. S. Wrightsman, 1990, New York: Academic Press).

Zhang, L. (2009). An exchange theory of money and self-esteem in decision making. Review of General Psychology, 13, 66-76. http://doi.org/fmztb6

JIUHUA ZHENG

East China Normal University and Shenyang Normal University

YILU ZHONG AND YONGFANG LIU

East China Normal University

Jiuhua Zheng, School of Psychology and Cognitive Science, East China Normal University, and School of Management, Shenyang Normal University; Yilu Zhong and Yongfang Liu, School of Psychology and Cognitive Science, East China Normal University.

This study was supported by National Natural Science Foundation of China (31271112) and Program for New Century Excellent Talents in University of China (NCET-10-353).

Correspondence concerning this article should be addressed to: Yongfang Liu, School of Psychology and Cognitive Science, East China Normal University, 3663 North Zhongshan Road, Shanghai 200062, People's Republic of China. Email: yfliu@psy.ecnu.edu.cn
COPYRIGHT 2013 Scientific Journal Publishers, Ltd.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2013 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Author:Zheng, Jiuhua; Zhong, Yilu; Liu, Yongfang
Publication:Social Behavior and Personality: An International Journal
Article Type:Report
Geographic Code:9CHIN
Date:Jun 1, 2013
Words:1713
Previous Article:Coping and mental health of Iranian social workers: the impact of client violence.
Next Article:Impact of extroversion and introversion on language-learning behaviors.
Topics:

Terms of use | Privacy policy | Copyright © 2019 Farlex, Inc. | Feedback | For webmasters