Dynamic choice and the common ratio effect: an experimental investigation

Article Abstract:

An examination of the violations in the common ratio effect in the expected utility theory shows that individual decisions that impinge upon dynamic choice problems often violate the timing independence parameter that leads to the violation of the common ratio effect. This is due to the effects of the sequence of such decisions and its interaction with chance events that determine the level of risk in such decisions, especially in terms of precommitment of facilities and the failure to anticipate other risks.

Decision-making, Decision making

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Experimental economics: hard science or wasteful tinkering?

Article Abstract:

Experimental economics is considered by some theorists as a logical bridge to the gap between theory and evidence. However, minimal support in economic literature makes expected utility theory (EUT) a more reasonable and superior alternative to experimental economics. Although questions have been raised over the reliability or relevance of experimental data, these questions do not necessarily render theories such as EUT pale when compared against results of conventional theories or real market environments.

Economic research, Beliefs, opinions and attitudes

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Does part-whole bias exist? An experimental investigation

Article Abstract:

The existence of the part-whole bias (PHB), the disparity in an individual's valuations of goods in parts and on the whole with incentive compatible mechanisms, could not be attributed solely on the problems of the contingent valuation method. The PHB appears to be a factor of an individual's preference that traditional theory, like the Hicksian consumer theory, could not explain.

Research, Consumer preferences

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