Reducing the Reluctance to Exchange Gambles
Bar-Hillel and Neter (1996) found that although people are willing to trade identical objects, they are reluctant to trade identical lottery tickets. Is this simply due to the fact that these are gambles? It was found that if the value of the tickets is guaranteed to be ex-post, not just ex ante, identical, people are more willing to exchange them. Indeed, just the possibility of ex-post difference between the lottery tickets induces as much reluctance to exchange them as when ex-post difference is guaranteed. In addition, this study examines how the vividness of lottery tickets influences the willingness to trade them. Specifically, it examines whether people are equally reluctant to exchange lottery tickets (when given a bonus for doing so) when they cannot even distinguish between them (e.g., when the tickets are concealed in envelopes). When one cannot see the ticket, it is less vivid and it is harder to imagine it winning. Indeed, it was found that people are more willing to exchange when they cannot distinguish between the tickets than when they can.
|Date of creation:||Oct 2003|
|Date of revision:|
|Publication status:||Published in Judgment and Decision Making, 6(2), 147-155|
|Contact details of provider:|| Postal: |
Web page: http://www.ratio.huji.ac.il/
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Kahneman, Daniel & Tversky, Amos, 1979.
"Prospect Theory: An Analysis of Decision under Risk,"
Econometric Society, vol. 47(2), pages 263-91, March.
- Amos Tversky & Daniel Kahneman, 1979. "Prospect Theory: An Analysis of Decision under Risk," Levine's Working Paper Archive 7656, David K. Levine.
- 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 1325-48, December.
- Tversky, Amos & Kahneman, Daniel, 1991. "Loss Aversion in Riskless Choice: A Reference-Dependent Model," The Quarterly Journal of Economics, MIT Press, vol. 106(4), pages 1039-61, November.
- Knetsch, Jack L, 1989. "The Endowment Effect and Evidence of Nonreversible Indifference Curves," American Economic Review, American Economic Association, vol. 79(5), pages 1277-84, December.
When requesting a correction, please mention this item's handle: RePEc:huj:dispap:dp341. 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: (Ilan Nehama)
If references are entirely missing, you can add them using this form.