When Allais meets Ulysses: Dynamic Consistency and the Certainty Effect
AbstractWe report experimental findings about subjects’ behavior in dynamic decision problems involving multistage lotteries with different timings of resolution of uncertainty. Our within subject design allows us to study violations of the independence axiom in the light of the dynamic axioms' ones : dynamic consistency, consequentialism and reduction of compound lotteries.
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Bibliographic InfoPaper provided by LAMETA, Universtiy of Montpellier in its series Working Papers with number 09-30.
Length: 8 pages
Date of creation: Dec 2009
Date of revision: Sep 2012
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This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-01-16 (All new papers)
- NEP-CBE-2010-01-16 (Cognitive & Behavioural Economics)
- NEP-EXP-2010-01-16 (Experimental Economics)
- NEP-UPT-2010-01-16 (Utility Models & Prospect Theory)
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