Willingness to take risk depends on whether the risk affects others as well as oneself and on how the risk affects oneś position vis-á-vis others. Taking a bet can improve oneś position relative to others or threaten it. We present an experiment that explores individual attitudes to lotteries...

In a simple model where agents have ordinal and interpersonally noncomparable subjective expected utility preferences over uncertain future incomes, we analyze the implications of equity, efficiency, separability, and social rationality. Our efficiency conditions are fairly weak, because there...

We study a two-stage choice problem, where alternatives are allocations between the decision maker (DM) and a passive recipient. The recipient observes choice behavior in stage two, while stage one choice is unobserved. Choosing selfishly in stage two, in the face of a fairer available...

We study a decision maker (DM) who has preferences over sets of payoff-allocations between herself and a passive recipient, which represent second-stage choice problems. The recipient is only aware of second-stage choice of an allocation. Not choosing the normatively best allocation in the...

The literature on social preferences provides overwhelming evidence of departures from pure self-interest of individuals. Experiments show that people care about others' well-being and their relative standing. This paper investigates whether this type of behavior persists when risk comes into...

The literature on social preferences provides overwhelming evidence of departures from pure self-interest of individuals. Experiments show that people care about others’ well-being and their relative standing. This paper investigates whether this type of behavior persists when risk comes into...

We assess the empirical validity of the overall theoretical framework of other-regarding preferences by focusing on those preference axioms that are common to all the prominent theories of outcome-based other-regarding preferences. This common set of preference axioms leads to a testable...

Recent theoretical work in the economics of climate change has suggested that climate policy is highly sensitive to "fat-tailed" risks of catastrophic outcomes (Weitzman, 2009b). Such risks are suggested to be an inevitable consequence of scientific uncertainty about the effects of increased...

This paper theoretically and experimentally studies decision-making in risky and social environments. We explore the interdependence of individual risk attitudes and social preferences in form of inequality aversion as two decisive behavioral determinants in such contexts. Our model and the data...