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Multiple switching behavior in different display formats of multiple price lists

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  • Bauermeister, Golo-Friedrich
  • Mußhoff, Oliver

Abstract

A common approach to elicit risk attitude is the multiple price list with a series of binary choices. However, a frequently observed problem when using multiple price lists is that participants switch more than once from the safer to the riskier option, thus exhibiting multiple switching behavior. The present study analyzes whether the visualization of different multiple price lists reduce multiple switching behavior. Therefore, we conduct two types of multiple price lists in two different display formats. Participants are randomly assigned into a textual or a visual group and carry out both multiple price lists in the corresponding display format. Our results reveal that different types of multiple price lists lead to differences in the extent of multiple switching behavior. Moreover, we show that the visualization of a multiple price list can be an instrument to greatly reduce multiple switching behavior.

Suggested Citation

  • Bauermeister, Golo-Friedrich & Mußhoff, Oliver, 2017. "Multiple switching behavior in different display formats of multiple price lists," Department of Agricultural and Rural Development (DARE) Discussion Papers 260770, Georg-August-Universitaet Goettingen, Department of Agricultural Economics and Rural Development (DARE).
  • Handle: RePEc:ags:gadadp:260770
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    Keywords

    Consumer/Household Economics; Institutional and Behavioral Economics;

    JEL classification:

    • C90 - Mathematical and Quantitative Methods - - Design of Experiments - - - General
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • D89 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Other

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