Playing for peanuts: Why is risk seeking more common for low-stakes gambles?

Previous research has found that decision makers are more risk seeking for small-stakes gambles than for large-stakes gambles. This “peanuts effect” is not easily explained by Prospect Theory. Two experiments examined the range of circumstances in which peanuts effects occur and tested the hypothesis that anticipated disappointment or anticipated regret explains the peanuts effect. The results suggest that the peanuts effect is related to disappointment, but do not support a connection between the peanuts effect and regret.