How far ahead do people plan?
We report on a simple experiment which enables us to infer how far people plan ahead when taking decisions in a dynamic risky context. Usually economic theory assumes that people plan right to the end of the planning horizon. We find that this is true for a little over half of the subjects in the experiment, while a little under one half seem not to plan ahead at all.
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- John D. Hey, 2002. "Experimental Economics and the Theory of Decision Making Under Risk and Uncertainty," The Geneva Risk and Insurance Review, Palgrave Macmillan;International Association for the Study of Insurance Economics (The Geneva Association), vol. 27(1), pages 5-21, June.
- John D. Bone & John D. Hey & John R. Suckling, 2003. "Do people plan ahead?," Applied Economics Letters, Taylor & Francis Journals, vol. 10(5), pages 277-280, April.
- Enrica Carbone & John Hey, 2001. "A Test of the Principle of Optimality," Theory and Decision, Springer, vol. 50(3), pages 263-281, May.