IDEAS home Printed from https://ideas.repec.org/p/bge/wpaper/1607.html

Lottery-Specific Effects and Heterogeneity: A Unified Framework

Author

Listed:
  • Jose Apesteguia
  • Miguel Ángel Ballester
  • Ángelo Gutiérrez-Daza

Abstract

We develop a framework for studying lottery-specific deviations from expected utility without imposing a particular behavioral model. Certainty-equivalent valuations arise from a distribution over expected-utility preferences. We characterize two lottery-dependent extensions axiomatically: one allows lottery characteristics to shift the distribution's location, capturing mean risk attitudes, and the other its scale, capturing behavioral noise. Using 197,465 observations from 15 studies, covering 1,299 lotteries, 90 treatments, and 7,362 individuals, we find that complexity-related characteristics primarily affect noise, whereas probability mass tilted toward favorable payoffs and the presence of losses primarily affect mean risk attitudes. The framework organizes empirical regularities usually treated separately.

Suggested Citation

  • Jose Apesteguia & Miguel Ángel Ballester & Ángelo Gutiérrez-Daza, 2026. "Lottery-Specific Effects and Heterogeneity: A Unified Framework," Working Papers 1607, Barcelona School of Economics.
    • Handle: RePEc:bge:wpaper:1607
    as

    Download full text from publisher

    File URL: https://bw.bse.eu/wp-content/uploads/1607_compressed.pdf
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;
    ;
    ;

    JEL classification:

    • C13 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Estimation: General
    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making

    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:bge:wpaper:1607. See general information about how to correct material in RePEc.

    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.

    We have no bibliographic references for this item. You can help adding them by using 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.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Bruno Guallar (email available below). General contact details of provider: https://edirc.repec.org/data/bargses.html .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.