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The two faces of independence: Betweenness and homotheticity

Burghart, Daniel R.; Epper, Thomas; Fehr, Ernst - 2014

Many studies document failures of expected utility's key assumption, the independence axiom. Here, we show that independence can be decomposed into two distinct axioms - betweenness and homotheticity - and that these two axioms are necessary and sufficient for independence. Thus, independence...

Persistent link: https://www.econbiz.de/10011282512

The value of safety or the value of the good?

Järnberg, Linda Andersson; Andrén, Daniela; … - 2024

This study analyzes how the willingness to pay (WTP) for a risk reduction for traffic accidents varies depending on the specific traffic safety measures and whether they are framed as public or private goods. Building on previous studies, we designed and conducted a contingent valuation survey...

Persistent link: https://www.econbiz.de/10015209891

The downward spiral

Greenwood, Jeremy; Guner, Nezih; Kopecky, Karen A. - 2022

There have been more than 500,000 opioid overdose deaths since 2000. To analyze the opioid epidemic, we construct a model where individuals, with and without pain, choose whether to misuse opioids knowing the probabilities of addiction and dying. These odds are functions of opioid use. Markov...

Persistent link: https://www.econbiz.de/10014278374

The effect of income on positive and negative subjective well-being

Boes, Stefan; Winkelmann, Rainer - 2006

Increasing evidence from the empirical economic and psychological literature suggests that positive and negative well-being … analyzing the determinants of subjective well-being. We argue that this conclusion reflects in part the use of too restrictive … asymmetries in single-item measures of subjective well-being. An application to data from the German Socio-Economic Panel for 1984 …

Persistent link: https://www.econbiz.de/10010315521

Money illusion under test

Boes, Stefan; Lipp, Markus; Winkelmann, Rainer - 2005

Much progress has been made in recent years in developing and applying a direct measure of utility using survey questions on satisfaction with income and with life in general. In this paper we apply this new type of measurement to the study of money illusion. Using data from the German...

Persistent link: https://www.econbiz.de/10010315573

Conspicuous consumption and satisfaction

Winkelmann, Rainer - 2011

Traditional tools of welfare economics identify the envy-related welfare loss from conspicuous consumption only under … very strong assumptions. Measured income and life satisfaction offers an alternative for estimating such consumption … externalities. The approach is developed in the context of luxury car consumption (Ferraris and Porsches) in Switzerland. Results …

Persistent link: https://www.econbiz.de/10010316849

Inequality and household finance during the consumer age

Cynamon, Barry Z.; Fazzari, Steven M. - 2013

One might expect that rising US income inequality would reduce demand growth and create a drag on the economy because higher-income groups spend a smaller share of income. But during a quarter century of rising inequality, US growth and employment were reasonably strong, by historical standards,...

Persistent link: https://www.econbiz.de/10010318662

Spending responses to state sales tax holidays

Agarwal, Sumit; McGranahan, Leslie - 2012

encourage consumption, effecting over 100 million consumers. We use a unique dataset of credit cards transaction to study the …

Persistent link: https://www.econbiz.de/10010292191

Job Loss, Credit Constraints and Consumption Growth

Crossley, Thomas F.; Low, Hamish W. - 2011

We use direct evidence on credit constraints to study their importance for household consumption growth and for welfare …. We distentangle the direct effect on consumption growth of a currently binding credit constraints from the indirect … effect of a potentially binding credit constraint which generates consumption risk. Our data is focused on job losers. We …

Persistent link: https://www.econbiz.de/10010500185

Household Consumption Through Recent Recessions

Crossley, Thomas F.; Low, Hamish; O'Dea, Cormac - 2011

This paper examines trends in household consumption and saving behaviour in each of the last three recessions in the UK …

Persistent link: https://www.econbiz.de/10010500198