A review of the certainty effect and influence of information processing
AbstractThis review considers two explanations for behavioral decision-making in reference to the certainty and framing effects. The findings from various paradigms such as a single questionnaire, gambles with repetition, and gambles guided by feedback are explained either by prospect theory or by expected utility theory. Finally this review attempts to account for the different findings and offers a possible explanation for the conflicting results by considering the role of experience which in turn can alter how information in processed as described by fuzzy trace theory which is a dual process theory of reasoning. --
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Bibliographic InfoPaper provided by Kiel Institute for the World Economy in its series Economics Discussion Papers with number 2013-47.
Date of creation: 2013
Date of revision:
expected utility theory; prospect theory; fuzzy trace theory; certainty effect; framing effect;
Find related papers by JEL classification:
- A10 - General Economics and Teaching - - General Economics - - - General
- Y80 - Miscellaneous Categories - - Related Disciplines - - - Related Disciplines
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-09-28 (All new papers)
- NEP-CDM-2013-09-28 (Collective Decision-Making)
- NEP-HPE-2013-09-28 (History & Philosophy of Economics)
- NEP-UPT-2013-09-28 (Utility Models & Prospect Theory)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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- Hartog, Joop & Ferrer-i-Carbonell, Ada & Jonker, Nicole, 2002. "Linking Measured Risk Aversion to Individual Characteristics," Kyklos, Wiley Blackwell, vol. 55(1), pages 3-26.
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