Engle-Warnick, Jim; Laszlo, Sonia - Centre Interuniversitaire de Recherche en Analyse des … - 2006
We experimentally test whether risk aversion or ambiguity aversion can explain decisions in a learning-by-doing game. We first measure subjects' preferences toward risk and ambiguity, and then use these measures to predict behavior in the game. We find that ambiguity averse subjects pay more...