Year: 2017
Type: article
Abstract: Much uncertainty in life relates to the behaviour of others in interactive environments. This article tests some implications of subjective expected utility theory (Savage, 1954) in an experimental strategic setting where there is uncertainty about the actions of other players. In this environment, a large majority of our participants violate subjective expected utility theory. However, they do not exhibit the sorts of consistent ‘attitude to ambiguity’ found in individual decision experiments. We discuss three possible explanations of their behaviour: non‐linear transformation of probabilities; noise in responses; and/or systematic biases in the way that individuals generate subjective probabilities.
Source: The Economic Journal
DOI: 10.1111/ecoj.12486
Authors: Zhihua Li, Graham Loomes, Ganna Pogrebna
Institution: University of Warwick
Language: English
Subfield: General Decision Sciences
Field: Decision Sciences
Domain: Social Sciences
Open Access status: hybrid
Estimated APC paid: $4,463
Awards: Control and Trust as Moderating Mechanisms in addressing Vulnerability for the Design of Business and Economic Models (ConTriVE), G1386586370, G1703868433, G221209400, G2860868802, G3678697519, Network for Integrated Behavioural Science, G5381240138, G6128599341, G6431207096, G7050801856, G7342147324, G7372419796, G8579886662, Smart Me versus Smart Things: The Development of a Personal Resource Planning (PRP) System through Human Interactions with Data Enabled by the IoT
OpenAlex ID: W2583531882