The Fourfold Pattern of Risk Attitudes in Choice and Pricing Tasks
AbstractWe examine the robustness of the fourfold pattern of risk attitudes under two elicitation procedures. We find that individuals are, on average, risk-seeking over low-probability gains and high-probability losses and risk-averse over high-probability gains and low-probability losses when we elicit prices for the gambles. However, a choice-based elicitation procedure, where participants choose between a gamble and its expected value, yields individual decisions that are indistinguishable from random choice. Sensitivity to elicitation procedure holds between and within participants, and remains when participants are allowed to review and change decisions. The price elicitation procedure is more complex; this finding may be further evidence that an increase in cognitive load exacerbates behavioural anomalies. Copyright ï¿½ The Author(s). Journal compilation ï¿½ Royal Economic Society 2009.
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 InfoPaper provided by University of Pittsburgh, Department of Economics in its series Working Papers with number 268.
Date of creation: Jan 2005
Date of revision: Jan 2005
Other versions of this item:
- WilliamT Harbaugh & Kate Krause & Lise Vesterlund, 2010. "The Fourfold Pattern of Risk Attitudes in Choice and Pricing Tasks," Economic Journal, Royal Economic Society, vol. 120(545), pages 595-611, 06.
- NEP-ALL-2006-10-14 (All new papers)
- NEP-CBE-2006-10-14 (Cognitive & Behavioural Economics)
- NEP-EXP-2006-10-14 (Experimental Economics)
- NEP-MIC-2006-10-14 (Microeconomics)
- NEP-UPT-2006-10-14 (Utility Models & Prospect Theory)
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Paolo Crosetto & Antonio Filippin, 2013.
"A Theoretical and Experimental Appraisal of Five Risk Elicitation Methods,"
Jena Economic Research Papers
2013-009, Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics.
- Paolo Crosetto & Antonio Filippin, 2013. "A Theoretical and Experimental Appraisal of Five Risk Elicitation Methods," SOEPpapers on Multidisciplinary Panel Data Research 547, DIW Berlin, The German Socio-Economic Panel (SOEP).
- Susan Laury & Melayne McInnes & J. Swarthout, 2009. "Insurance decisions for low-probability losses," Journal of Risk and Uncertainty, Springer, vol. 39(1), pages 17-44, August.
- Paolo Crosetto & Antonio Filippin, 2012.
"The "Bomb" Risk Elicitation Task,"
Jena Economic Research Papers
2012-035, Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics.
- Crosetto, Paolo & Filippin, Antonio, 2012. "The "Bomb" Risk Elicitation Task," IZA Discussion Papers 6710, Institute for the Study of Labor (IZA).
- Paolo Crosetto & Antonio Filippin, 2012. "The "Bomb" Risk Elicitation Task," SOEPpapers on Multidisciplinary Panel Data Research 517, DIW Berlin, The German Socio-Economic Panel (SOEP).
- Stefan Zeisberger & Dennis Vrecko & Thomas Langer, 2012. "Measuring the time stability of Prospect Theory preferences," Theory and Decision, Springer, vol. 72(3), pages 359-386, March.
- Helga Fehr-Duda & Thomas Epper, 2012. "Probability and Risk: Foundations and Economic Implications of Probability-Dependent Risk Preferences," Annual Review of Economics, Annual Reviews, vol. 4(1), pages 567-593, 07.
- Chetan Dave & Catherine Eckel & Cathleen Johnson & Christian Rojas, 2010. "Eliciting risk preferences: When is simple better?," Journal of Risk and Uncertainty, Springer, vol. 41(3), pages 219-243, December.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Alistair Wilson).
If references are entirely missing, you can add them using this form.