| Summary: | Financial loss aversion refers to the greater sensitivity of monetary losses over monetary gains. The purpose of this study was to understand more about the correlations between five demographic factors (i.e. level of income, level of education, age, race and gender) and individuals’ level of financial loss aversion. Furthermore, we also seek to ascertain if framing interacts with demographic factors to affect loss aversion.
In our study, we discovered that older individuals are more loss averse than younger individuals; women are more loss averse than men; level of income has an inverse U-shaped relationship with loss aversion; Chinese are less loss averse than Malay and Indian; and higher educated individuals have lower loss aversion than lower educated people. Also, it was determined that level of education is the factor with the highest correlation among the demographic factors and that framing has more effect on women than men.
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