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Selection and Mode Effects in Risk Preference Elicitation Experiments

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  • von Gaudecker, H.M.
  • van Soest, A.H.O.

    (Tilburg University, Center For Economic Research)

  • Wengstrom, E.

Abstract

An ever increasing number of experiments attempts to elicit risk preferences of a population of interest with the aim of calibrating parameters used in economic models. We are concerned with two types of selection effects, which may affect the external validity of standard experiments: Sampling from a narrowly defined population of students (“experimenter-induced selection”) and self-selection due to non-response or incomplete response of participants in a random sample from a broad population. We find that both types of selection lead to a sample of experts: Participants perform significantly better than the general population, in the sense of fewer violations of revealed preference conditions. Self-selection within a broad population does not seem to matter for average preferences. In contrast, sampling from a student population leads to lower estimates of average risk aversion and loss aversion parameters. Furthermore, it dramatically reduces the amount of heterogeneity in all parameters. Copyright Springer Science+Business Media New York 2012
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • von Gaudecker, H.M. & van Soest, A.H.O. & Wengstrom, E., 2008. "Selection and Mode Effects in Risk Preference Elicitation Experiments," Discussion Paper 2008-11, Tilburg University, Center for Economic Research.
  • Handle: RePEc:tiu:tiucen:35714555-f654-4522-bcb1-b35ec93c5f4a
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    More about this item

    Keywords

    Risk aversion; Internet surveys; Laboratory experiments;
    All these keywords.

    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

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