Goal-induced risktaking in negotiation and decision making

Published

Journal Article

Three experiments test whether specific, challenging goals increase risk taking. We propose that goals serve as reference points, creating a region of perceived losses for outcomes below a goal (Kahneman & Tversky, 1979; Tversky & Kahneman, 1992). According to the Prospect Theory value function, decision makers become more risk seeking in the domain of losses. In all three experiments we compared a "do your best" condition with a "specific, challenging goal" condition. The goal condition consistently increased risky behavior in both negotiation and decision making tasks. The discussion considers how goals influence expectations, strategy choice, and unethical behavior.

Full Text

Duke Authors

Cited Authors

  • Larrick, RP; Heath, C; Wu, G

Published Date

  • June 1, 2009

Published In

Volume / Issue

  • 27 / 3

Start / End Page

  • 342 - 364

International Standard Serial Number (ISSN)

  • 0278-016X

Digital Object Identifier (DOI)

  • 10.1521/soco.2009.27.3.342

Citation Source

  • Scopus