Are bygones bygones?
The paper reports an experiment which tests the principle of separability, i.e. that behaviour in a dynamic choice problem is independent of history and of unreachable eventualities. Although this is a well-known principle of orthodox decision theory and central to conventional economic modelling, it has been questioned on grounds suggested by non-expected utility models of choice under risk and by the psychology of affective influences on risk-taking. Our experimental design, which provides between-subjects tests of separability using three treatments in which the history preceding a decision is manipulated, is inspired by these concerns. We expose separability to a clean and harsh test, but find no evidence that it is violated.
Year of publication: |
2010-01
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Authors: | Cubitt, Robin ; Ruiz-Martos, Maria ; Starmer, Chris |
Institutions: | Centre for Decision Research and Experimental Economics (CeDEx), School of Economics |
Subject: | Separability | history-independence | non-expected utility | risk and affect |
Saved in:
freely available
Extent: | application/pdf |
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Series: | Discussion Papers. - ISSN 1749-3293. |
Type of publication: | Book / Working Paper |
Notes: | Number 2010-01 |
Source: |
Persistent link: https://www.econbiz.de/10008592423