Risk attitude elicitation using a multi-lottery choice task: Realvs. hypothetical incentives
Year: 2011
Type: article
Abstract: We present a bi-dimensional multi lottery choice task which can be used in order to elicit the agents' risk attitudes in financial environments. This task is implemented both with hypothetical and real monetary incentives in a between-subjects and a within-subjects experiment. We observe choices involving significantly lower risk aversion on aggregate when incentives are real. The differences grow with the stakes at play. We also obtain significant differences between hypothetical and real rewards in both utility weighting and probability weighting estimated parameters. We find that the use of hypothetical incentives in multi-lottery choice tasks for evaluating individual risk aversion can be misleading.
Language: Spanish
Subfield: General Decision Sciences
Field: Decision Sciences
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W2300906372