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| Andrea Morone and Ulrich Schmidt |
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| ''An Experimental Investigation of Alternatives to Expected Utility Using Pricing Data'' |
| ( 2008, Vol. 4 No.20 ) |
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| Experimental research on decision making under risk has until now always employed choice data in order to evaluate the empirical performance of expected utility and the alternative non-expected utility theories. The present paper performs a similar analysis which relies on pricing data instead of choice data. Since pricing data lead in many cases to a different ordering of lotteries than choices (e.g. the preference reversal phenomenon) our analysis may have fundamental different results than preceding investigations. We elicit three different types of pricing data: willingness-to-pay, willingness-to-accept and certainty equivalents under the Becker-DeGroot-Marschak (BDM) incentive mechanism. One of our main result shows that the comparative performance of the single theories differs significantly under these three types of pricing data. |
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| Keywords: experiments |
JEL: D8 - Information, Knowledge, and Uncertainty: General
C9 - Design of Experiments: General |
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| Manuscript Received : Jun 19 2008 | | Manuscript Accepted : Jun 27 2008 |
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