Loss Aversion

  • Takis S. Pappas


Why did the crisis-battered Greeks desert the center and flee to both extremes of the political spectrum? Contrary to established theories, and drawing from cognitive psychology and behavioral economics, it is shown that, as the crisis hit Greece much harder than any other European nation, Greek voters became particularly averse to losing what they had gained during the years of populist democracy. Hence, they chose the probability of a serious political impasse over the sure economic loss caused by austerity and reformism.


Government Spending Loss Aversion Youth Unemployment Sovereign Debt Crisis Incumbent Party 
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Copyright information

© Takis S. Pappas 2014

Authors and Affiliations

  • Takis S. Pappas
    • 1
    • 2
  1. 1.Department of Balkan, Slavic and Oriental StudiesUniversity of MacedoniaGreece
  2. 2.Department of Political and Social SciencesEuropean University InstituteFlorenceItaly

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