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Testing New Theories of Choice under Uncertainty using the Common Consequence Effect

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  • Chris Starmer

Abstract

A generalised common consequence problem is used to contrast the predictions of expected utility theory and several new theories of choice under uncertainty. An experiment designed to test these predictions is reported. Systematic violations of expected utility theory are detected but although a consistent pattern emerges from the data, it offers little support for any of the new theories. The analysis is extended to test predictions which are unique to regret theory and significant regret effects are detected.

Suggested Citation

  • Chris Starmer, 1992. "Testing New Theories of Choice under Uncertainty using the Common Consequence Effect," Review of Economic Studies, Oxford University Press, vol. 59(4), pages 813-830.
  • Handle: RePEc:oup:restud:v:59:y:1992:i:4:p:813-830.
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    File URL: http://hdl.handle.net/10.2307/2297999
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    References listed on IDEAS

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    1. David E. Bell, 1982. "Regret in Decision Making under Uncertainty," Operations Research, INFORMS, vol. 30(5), pages 961-981, October.
    2. David E. Bell, 1985. "Disappointment in Decision Making Under Uncertainty," Operations Research, INFORMS, vol. 33(1), pages 1-27, February.
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