IDEAS home Printed from https://ideas.repec.org/a/wly/jpamgt/v14y1995i1p68-78.html
   My bibliography  Save this article

Assumptions, behavioral findings, and policy analysis

Author

Listed:
  • Jack L. Knetsch

    (Professor of Economics and Resource Management, School of Resource and Environmental Management, Simon Fraser University)

Abstract

Recent empirical studies indicate that many standard economic assumptions used in policy analyses do not reflect people's preferences and choices as well as modifications based on behavioral findings. Differences in the areas of time preferences and the large disparity between valuations of gains and losses illustrate the issues and the distortions that present analyses likely impose.

Suggested Citation

  • Jack L. Knetsch, 1995. "Assumptions, behavioral findings, and policy analysis," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 14(1), pages 68-78.
  • Handle: RePEc:wly:jpamgt:v:14:y:1995:i:1:p:68-78
    DOI: 10.2307/3325433
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.2307/3325433
    File Function: Link to full text; subscription required
    Download Restriction: no

    References listed on IDEAS

    as
    1. Jack L. Knetsch & J. A. Sinden, 1984. "Willingness to Pay and Compensation Demanded: Experimental Evidence of an Unexpected Disparity in Measures of Value," The Quarterly Journal of Economics, Oxford University Press, vol. 99(3), pages 507-521.
    2. Knetsch, Jack L, 1989. "The Endowment Effect and Evidence of Nonreversible Indifference Curves," American Economic Review, American Economic Association, vol. 79(5), pages 1277-1284, December.
    3. Shiller, Robert J & Boycko, Maxim & Korobov, Vladimir, 1991. "Popular Attitudes toward Free Markets: The Soviet Union and the United States Compared," American Economic Review, American Economic Association, vol. 81(3), pages 385-400, June.
    4. Richard H. Thaler, 2008. "Mental Accounting and Consumer Choice," Marketing Science, INFORMS, vol. 27(1), pages 15-25, 01-02.
    5. Kahneman, Daniel & Knetsch, Jack L & Thaler, Richard, 1986. "Fairness as a Constraint on Profit Seeking: Entitlements in the Market," American Economic Review, American Economic Association, vol. 76(4), pages 728-741, September.
    6. Kahneman, Daniel & Thaler, Richard H, 1991. "Economic Analysis and the Psychology of Utility: Applications to Compensation Policy," American Economic Review, American Economic Association, vol. 81(2), pages 341-346, May.
    7. Knetsch, Jack L., 1992. "Preferences and nonreversibility of indifference curves," Journal of Economic Behavior & Organization, Elsevier, vol. 17(1), pages 131-139, January.
    8. Kahneman, Daniel & Knetsch, Jack L & Thaler, Richard H, 1990. "Experimental Tests of the Endowment Effect and the Coase Theorem," Journal of Political Economy, University of Chicago Press, vol. 98(6), pages 1325-1348, December.
    9. George Loewenstein & Drazen Prelec, 1992. "Anomalies in Intertemporal Choice: Evidence and an Interpretation," The Quarterly Journal of Economics, Oxford University Press, vol. 107(2), pages 573-597.
    10. Dermot Gately, 1980. "Individual Discount Rates and the Purchase and Utilization of Energy-Using Durables: Comment," Bell Journal of Economics, The RAND Corporation, vol. 11(1), pages 373-374, Spring.
    11. Frey, Bruno S. & Pommerehne, Werner W., 1993. "On the fairness of pricing -- An empirical survey among the general population," Journal of Economic Behavior & Organization, Elsevier, vol. 20(3), pages 295-307, April.
    12. Baumol,William J. & Oates,Wallace E., 1988. "The Theory of Environmental Policy," Cambridge Books, Cambridge University Press, number 9780521322249.
    13. Gregory, Robin & Lichtenstein, Sarah & MacGregor, Donald, 1993. "The Role of Past States in Determining Reference Points for Policy Decisions," Organizational Behavior and Human Decision Processes, Elsevier, vol. 55(2), pages 195-206, July.
    14. Colin F. Camerer & Howard Kunreuther, 1989. "Decision processes for low probability events: Policy implications," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 8(4), pages 565-592.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ulrich Schmidt & Stefan Traub, 2009. "An Experimental Investigation of the Disparity Between WTA and WTP for Lotteries," Theory and Decision, Springer, vol. 66(3), pages 229-262, March.
    2. Berg, Nathan, 2003. "Normative behavioral economics," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 32(4), pages 411-427, September.
    3. John K. Horowitz & Kenneth E. McConnell & James J. Murphy, 2013. "Behavioral foundations of environmental economics and valuation," Chapters,in: Handbook on Experimental Economics and the Environment, chapter 4, pages 115-156 Edward Elgar Publishing.
    4. Lazaro, Angelina & Barberan, Ramon & Rubio, Encarnacion, 2002. "The discounted utility model and social preferences:: Some alternative formulations to conventional discounting," Journal of Economic Psychology, Elsevier, vol. 23(3), pages 317-337, June.
    5. Schaaf, Kenli A. & Broussard, Shorna R., 2006. "Private forest policy tools: A national survey exploring the American public's perceptions and support," Forest Policy and Economics, Elsevier, vol. 9(4), pages 316-334, December.
    6. Richard O. Zerbe, 2013. "Ethical benefit–cost analysis as art and science: ten rules for benefit–cost analysis," Chapters,in: Principles and Standards for Benefit–Cost Analysis, chapter 8, pages 264-293 Edward Elgar Publishing.
    7. Anderson, C. Leigh & Stamoulis, Kostas, 2006. "Applying Behavioural Economics to International Development Policy," WIDER Working Paper Series 024, World Institute for Development Economic Research (UNU-WIDER).
    8. Shaw, W. Douglass & Woodward, Richard T., 2008. "Why environmental and resource economists should care about non-expected utility models," Resource and Energy Economics, Elsevier, vol. 30(1), pages 66-89, January.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:jpamgt:v:14:y:1995:i:1:p:68-78. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley-Blackwell Digital Licensing) or (Christopher F. Baum). General contact details of provider: http://www3.interscience.wiley.com/journal/34787/home .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.