Is Choice the Correct Primitive? On Using Certainty Equivalents and Reference Levels to Predict Choices among Gambles
AbstractChoice is viewed as a derived, not a primitive, concept. Individual gambles are assigned subjective certainty equivalents the choice set "X" has an associated reference level [RL("X")] based on the certainty equivalents of its members; the outcomes of each gamble are recoded as deviations from the RL("X"); and new certainty equivalents are constructed. The gamble having the largest new certainty equivalents is chosen. The certainty equivalents are described by the rank- and sign-dependent theory of Luce (1992). The concept of RL is studied axiomatically. The model predicts many behavioral anomalies and is tested with data sets of Mellers, Chang, Birnbaum, and Ordonez (1992). Copyright 1993 by Kluwer Academic Publishers
Download InfoTo our knowledge, this item is not available for download. To find whether it is available, there are three options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.
Bibliographic InfoArticle provided by Springer in its journal Journal of Risk and Uncertainty.
Volume (Year): 6 (1993)
Issue (Month): 2 (April)
Contact details of provider:
Web page: http://www.springerlink.com/link.asp?id=100299
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Yves Alarie & Georges Dionne, 2006.
Cahiers de recherche
- Enrico Diecidue & Ulrich Schmidt & Horst Zank, 2006.
"Parametric Weighting Functions,"
The School of Economics Discussion Paper Series
0622, Economics, The University of Manchester.
- Enrico Diecidue & Ulrich Schmidt & Horst Zank, 2008. "Parametric Weighting Functions," Kiel Working Papers 1395, Kiel Institute for the World Economy.
- Zank, Horst & Schmidt, Ulrich & Diecidue, Enrico, 2007. "Parametric Weighting Functions," Economics Working Papers 2007,01, Christian-Albrechts-University of Kiel, Department of Economics.
- William S. Neilson, 2000. "Victory and Defeat in a Model of Behavior in Games and Toward Risk," Econometric Society World Congress 2000 Contributed Papers 0690, Econometric Society.
- Liang Zou, 2006. "An Alternative to Prospect Theory," Annals of Economics and Finance, Society for AEF, vol. 7(1), pages 1-28, May.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Guenther Eichhorn) or (Christopher F. Baum).
If references are entirely missing, you can add them using this form.