Craving money? Evidence from the laboratory and the field

We propose a new model of choice under repeated exposure to gambles. In it, the agent may come to choose a negative expected value, negative skew gamble, due to a behavioral bias that has a neurobiological foundation. We run laboratory experiments as a first step in testing the model and supplement the experimental findings with suggestive evidence from observational data. In the process of doing so, we identify a new asset pricing anomaly. The findings bring novel insights into the motivations underlying investor decisions and the impact of temptation and self-control in contexts of repeated risk-taking.