Do Trade Union Leaders Violate Subjective Expected Utility? Some Insights From Experimental Data
AbstractThis paper presents the results of two experiments designed to test violations of Subjective Expected Utility Theory (SEUT) within a sample of Italian trade union delegates and leaders. Subjects priced risky and ambiguous prospects in the domain of gains. Risky prospects were based on games of chance, while ambiguous prospects were built on the standard Ellsberg paradox and on event lotteries whose outcomes were based either on the results of a fictional election or on the future results of the 1999 European Parliamentary election in Italy and the U.K. The experiments show that, although risky prospects were priced at their expected values on average, trade union delegates and leaders did violate SEUT when assessing ambiguous prospects. Moreover, their behaviour depended on the source of uncertainty (Ellsberg paradox vs. electoral results; fictional vs. real election; Italy vs. U.K. election outcomes). We discuss the implications of these results for the economic theory of the trade union. Copyright Springer 2005
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Bibliographic InfoArticle provided by Springer in its journal Theory and Decision.
Volume (Year): 59 (2005)
Issue (Month): 3 (November)
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Web page: http://www.springerlink.com/link.asp?id=100341
ambiguity; Ellsbergâ€™s paradox; trade unions; D81; J51;
Other versions of this item:
- Maffioletti, Anna & Santoni, Michele, 2001. "Do Trade Union Leaders Violate Subjective Expected Utility?Some Insights from Experimental Data," Sonderforschungsbereich 504 Publications 01-43, Sonderforschungsbereich 504, Universität Mannheim & Sonderforschungsbereich 504, University of Mannheim.
- Anna Maffioletti & Michele Santoni, 2001. "Do trade union leaders violate subjective expected utility? Some insight from experimental data," Departmental Working Papers 2001-15, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
- D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
- J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
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