Society for Judgment and Decision Making Presents Carnegie Mellon's Alex Imas With New Investigator Award
By Shilo Rea / 412-268-6094
The Society for Judgment and Decision Making has selected Carnegie Mellon University's Alex Imas as the 2014 winner of its Hillel Einhorn New Investigator Award. The award is presented each year to honor the best paper by a young researcher.
Imas, assistant professor of social and decision sciences in the Dietrich College of Humanities and Social Sciences, won for his paper "The Realization Effect: Risk-Taking After Realized Versus Paper Losses." This is the second award Imas has received for this paper. Last month he won the Distinguished CESifo Affiliate Award, which is given annually to a young economist for displaying scientific originality, policy relevance and quality in behavioral economics.
In "The Realization Effect," Imas explores how prior losses influence a person's attitude toward taking on additional risks. Determining how prior outcomes affect preferences for risk is critical for understanding how people make choices when faced with uncertainty. Previous research findings were inconsistent, even contradictory; some found that people took on more risk after a loss while others found the opposite - that they took on less risk.
"After a loss, do you declare 'double or nothing' or walk away? Up to now, researchers didn't know why you might choose one over the other," said Paul Fischbeck, interim head of the Department of Social and Decision Sciences. "Imas's research provides a clear explanation as to why. Given the uncertainties of daily life, understanding such basic phenomenon is critical to helping people make better decisions and designing effective public policies."
Imas shows that the seemingly inconsistent findings can be explained by individuals' different responses to realized versus "paper" losses, or unrealized capital losses. Following a realized loss, people are more likely to avoid risk. If the loss has not been realized, a paper loss, individuals are more likely to chase their losses and take on even greater risk. The findings have important implications for contract design and monitoring.
George Loewenstein, the Herbert A. Simon University Professor of Economics and Psychology at CMU, was the first winner of the Hillel Einhorn New Investigator Award for his 1988 paper "Frames of Mind in Intertemporal Choice." Loewenstein said that Imas' research "brilliantly, and deceptively simply, makes a lot of previous findings that, until he did his research, appeared contradictory. A lot of disparate findings suddenly fall into place."
Imas, who joined the CMU faculty after spending the 2013-14 academic year as a postdoctoral fellow in the Social and Decision Sciences Department, is interested in behavioral and experimental economics, particularly how social concerns and emotions influence decision making and preferences.
For more information, visit http://www.cmu.edu/dietrich/sds/people/faculty/alex-imas.html.
Alex Imas Wins CESifo Young Economist Award
Alex Imas (pictured above), assistant professor of social and decision sciences, won for his paper, "The Realization Effect: Risk-Taking After Realized Versus Paper Losses," which explores how prior losses influence a person's attitude toward taking on additional risks.