Risk aversion and embedding bias
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- dc.contributor.author Bosch, Antoni (Bosch-Domènech)ca
- dc.contributor.author Silvestre, Joaquimca
- dc.contributor.other Universitat Pompeu Fabra. Departament d'Economia i Empresa
- dc.date.accessioned 2017-07-26T10:50:15Z
- dc.date.available 2017-07-26T10:50:15Z
- dc.date.issued 2006-01-01
- dc.date.modified 2017-07-23T02:10:19Z
- dc.description.abstract In Selten (1967) Strategy Method, the second mover in the game submits a complete strategy. This basic idea has been exported to nonstrategic experiments, where a participant reports a complete list of contingent decisions, one for each situation or state in a given sequence, out of which one and only one state, randomly selected, will be implemented. In general, the method raises the following concern. If S0 and S1 are two different sequences of states, and state s is in both S0 and S1, would the participant make the same decision in state s when confronted with S0 as when confronted with S1? If not, the experimental results are suspect of suffering from an embedding bias. We check for embedding biases in elicitation methods of Charles Holt and Susan Laury (Laury and Holt, 2000, and Holt and Laury, 2002), and of the present authors (Bosch-Domènech and Silvestre, 1999, 2002, 2006a, b) by appropriately chosen replications of the original experiments. We find no evidence of embedding bias in our work. But in Holt and Laury s method participants tend to switch earlier to the riskier option when later pairs of lotteries are eliminated from the sequence, suggesting the presence of some embedding bias.
- dc.format.mimetype application/pdfca
- dc.identifier https://econ-papers.upf.edu/ca/paper.php?id=934
- dc.identifier.citation Theory and Decision, Volume 75:4, 465-496, 2013
- dc.identifier.uri http://hdl.handle.net/10230/572
- dc.language.iso eng
- dc.relation.ispartofseries Economics and Business Working Papers Series; 934
- dc.rights L'accés als continguts d'aquest document queda condicionat a l'acceptació de les condicions d'ús establertes per la següent llicència Creative Commons
- dc.rights.accessRights info:eu-repo/semantics/openAccess
- dc.rights.uri http://creativecommons.org/licenses/by-nc-nd/3.0/es/
- dc.subject.keyword embedding bias
- dc.subject.keyword strategy method
- dc.subject.keyword holt
- dc.subject.keyword laury
- dc.subject.keyword risk attraction
- dc.subject.keyword risk aversion
- dc.subject.keyword experiments
- dc.subject.keyword leex
- dc.subject.keyword Behavioral and Experimental Economics
- dc.title Risk aversion and embedding biasca
- dc.title.alternative "Measuring risk aversion with lists: A new bias"
- dc.type info:eu-repo/semantics/workingPaper