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Life expectancy as a constructed belief: Evidence of a live-to or die-by framing effect

  • John Payne

    ()

  • Namika Sagara
  • Suzanne Shu
  • Kirstin Appelt
  • Eric Johnson
Registered author(s):

    Life expectations are essential inputs for many important personal decisions. We propose that longevity beliefs are responses constructed at the time of judgment, subject to irrelevant task and context factors, and leading to predictable biases. Specifically, we examine whether life expectancy is affected by the framing of expectations questions as either live-to or die-by, as well as by factors that actually affect longevity such as age, gender, and self-reported health. We find that individuals in a live-to frame report significantly higher chances of being alive at ages 55 through 95 than people in a corresponding die-by frame. Estimated mean life expectancies across three studies and 2300 respondents were 7.38 to 9.17 years longer when solicited in a live-to frame. We are additionally able to show how this framing works on a process level and how it affects preference for life annuities. Implications for models of financial decision making are discussed. Copyright Springer Science+Business Media New York 2013

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    File URL: http://hdl.handle.net/10.1007/s11166-012-9158-0
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    Article provided by Springer in its journal Journal of Risk and Uncertainty.

    Volume (Year): 46 (2013)
    Issue (Month): 1 (February)
    Pages: 27-50

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    Handle: RePEc:kap:jrisku:v:46:y:2013:i:1:p:27-50
    Contact details of provider: Web page: http://www.springerlink.com/link.asp?id=100299

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    1. Payne, John W & Bettman, James R & Schkade, David A, 1999. "Measuring Constructed Preferences: Towards a Building Code," Journal of Risk and Uncertainty, Springer, vol. 19(1-3), pages 243-70, December.
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    10. Maria Perozek, 2008. "Using subjective expectations to forecast longevity: do survey respondents know something we don’t know?," Demography, Springer, vol. 45(1), pages 95-113, February.
    11. Michael D. Hurd, 2009. "Subjective Probabilities in Household Surveys," Annual Review of Economics, Annual Reviews, vol. 1(1), pages 543-564, 05.
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