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On whom would I want to depend; Humans or nature?

Author

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  • Mike Farjam

    (Friedrich Schiller University Jena, School of Economics)

Abstract

We study in an experiment whether humans prefer to depend on decisions of other humans (social uncertainty) or states of nature (environmental uncertainty). In the social uncertainty treatments subjects depend only on past decisions of other humans. This is the first experiment that studies social uncertainty that does not derive from a strategic situation. The results indicate that even without any strategic context humans prefer lotteries where the distribution of outcomes is due to states of nature to lotteries where the distribution is due to decisions of humans. This holds even when distributions are identical and known to subjects.

Suggested Citation

  • Mike Farjam, 2015. "On whom would I want to depend; Humans or nature?," Jena Economic Research Papers 2015-019, Friedrich-Schiller-University Jena.
  • Handle: RePEc:jrp:jrpwrp:2015-019
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    File URL: http://www2.wiwi.uni-jena.de/Papers/jerp2015/wp_2015_019.pdf
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    2. Farjam, Mike & Kirchkamp, Oliver, 2018. "Bubbles in hybrid markets: How expectations about algorithmic trading affect human trading," Journal of Economic Behavior & Organization, Elsevier, vol. 146(C), pages 248-269.

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    More about this item

    Keywords

    Ambiguity aversion; Experiment; Risk; Social Uncertainty;
    All these keywords.

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty

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