| 1. |
- Akay, Alpaslan, 1975, et al.
(författare)
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Attitudes toward uncertainty among the poor: An experiment in rural Ethiopia
- 2012
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Ingår i: Theory and Decision. - : Springer Science and Business Media LLC. - 0040-5833 .- 1573-7187. ; 73:3, s. 453-464
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Tidskriftsartikel (refereegranskat)abstract
- We investigate risk and ambiguity attitudes among Ethiopian farmers in one of the poorest regions of the world. Strong risk aversion and ambiguity aversion were found with the Ethiopian farmers. We compared their attitudes to those of a Western university student sample elicited by the same decision task. Ambiguity aversion was similar for farmers and students, but farmers were more risk averse. Our results show that ambiguity aversion is not restricted to Western student populations, and that studies of agricultural decisions may benefit from explicitly considering ambiguity attitudes.
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| 2. |
- Andersen, Steffen, et al.
(författare)
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Inferring beliefs as subjectively imprecise probabilities
- 2012
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Ingår i: Theory and Decision. - : Springer Nature. - 0040-5833 .- 1573-7187. ; 73:1, s. 161-184
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Tidskriftsartikel (refereegranskat)abstract
- We propose a method for estimating subjective beliefs, viewed as a subjective probability distribution. The key insight is to characterize beliefs as a parameter to be estimated from observed choices in a well-defined experimental task and to estimate that parameter as a random coefficient. The experimental task consists of a series of standard lottery choices in which the subject is assumed to use conventional risk attitudes to select one lottery or the other and then a series of betting choices in which the subject is presented with a range of bookies offering odds on the outcome of some event that the subject has a belief over. Knowledge of the risk attitudes of subjects conditions the inferences about subjective beliefs. Maximum simulated likelihood methods are used to estimate a structural model in which subjects employ subjective beliefs to make bets. We present evidence that some subjective probabilities are indeed best characterized as probability distributions with non-zero variance.
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| 3. |
- Andersen, Steffen, et al.
(författare)
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Non-linear mixed logit
- 2012
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Ingår i: Theory and Decision. - : Springer Nature. - 0040-5833 .- 1573-7187. ; 73:1, s. 77-96
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Tidskriftsartikel (refereegranskat)abstract
- We develop an extension of the familiar linear mixed logit model to allow for the direct estimation of parametric non-linear functions defined over structural parameters. Classic applications include the estimation of coefficients of utility functions to characterize risk attitudes and discounting functions to characterize impatience. There are several unexpected benefits of this extension, apart from the ability to directly estimate structural parameters of theoretical interest.
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| 4. |
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Beliefs in Groups
- 2018
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Ingår i: Theory and Decision. - : Springer Science and Business Media LLC. - 0040-5833 .- 1573-7187. ; 85:1, s. 1-116
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Annan publikation (refereegranskat)
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| 5. |
- Bos, Marieke, et al.
(författare)
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Scarcity and consumers’ credit choices
- 2022
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Ingår i: Theory and Decision. - : Springer Nature. - 1573-7187 .- 0040-5833. ; 92:1, s. 105-139
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Tidskriftsartikel (refereegranskat)abstract
- We study the effect of scarcity on decision making by low income Swedes. We exploit the random assignment of welfare payments to study their borrowing decisions within the pawn and mainstream credit market. We document that higher educated borrowers borrow less frequently and choose lower loan to value ratios when their budget constraints are exogenously tighter. In contrast, low-educated borrowers do not respond to temporary elevated levels of scarcity. This lack of response translates into a significantly higher probability to default and an 11.6% increase in borrowing cost. We show that a difference in access to liquidity and/or buffer stocks cannot explain our results. Instead a framework, where the awareness of self-control problems is positively correlated with education can explain that high-educated consumers choose a lower LTV as a commitment device to increase their likelihood to repay. Analogously, low-educated with less awareness of their future self-control problems, do not tie themselves to the mast and thus ignore the consequences of their credit decisions when focusing on solving acute liquidity problems. Our findings highlight that increased levels of scarcity risk reinforcing the conditions of poverty through overborrowing. © 2021, The Author(s), under exclusive licence to Springer Science+Business Media, LLC, part of Springer Nature.
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| 6. |
- Bouchouicha, Ranoua, et al.
(författare)
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Stake effects on ambiguity attitudes for gains and losses
- 2017
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Ingår i: Theory and Decision. - : Springer Science and Business Media LLC. - 0040-5833 .- 1573-7187. ; 83:1, s. 19-35
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Tidskriftsartikel (refereegranskat)abstract
- We test the effect of stake size on ambiguity attitudes. Compared to a baseline condition, we find subjects to be more ambiguity seeking for small-probability gains and large-probability losses under high stakes. They are also more ambiguity averse for large-probability gains and small-probability losses. We trace these effects back to stake effects on decisions under risk (known probabilities) and uncertainty (unknown probabilities). For risk, we replicate previous findings. For uncertainty, we find an increase in probabilistic insensitivity under high stakes that is driven by increased uncertainty aversion for large-probability gains and for small-probability losses.
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| 7. |
- Böörs, Mikael, et al.
(författare)
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Classification by decomposition: a novel approach to classification of symmetric 2 × 2 games
- 2022
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Ingår i: Theory and Decision. - : Springer Science and Business Media LLC. - 0040-5833 .- 1573-7187. ; 93:3, s. 463-508
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Tidskriftsartikel (refereegranskat)abstract
- In this paper, we provide a detailed review of previous classifications of 2 × 2 games and suggest a mathematically simple way to classify the symmetric 2 × 2 games based on a decomposition of the payoff matrix into a cooperative and a zero-sum part. We argue that differences in the interaction between the parts is what makes games interesting in different ways. Our claim is supported by evolutionary computer experiments and findings in previous literature. In addition, we provide a method for using a stereographic projection to create a compact 2-d representation of the game space. © 2021, The Author(s).
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| 8. |
- Carbone, Enrica, et al.
(författare)
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Should I stay or should I go? Congestion pricing and equilibrium selection in a transportation network
- 2022
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Ingår i: Theory and Decision. - : Springer. - 0040-5833 .- 1573-7187. ; :93, s. 535-562
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Tidskriftsartikel (refereegranskat)abstract
- When imposing traffic congestion pricing around downtown commercial centers, there is a concern that commercial activities will have to consider relocating due to reduced demand, at a cost to merchants. Concerns like these were important in the debates before the introductions of congestion charges in both London and Stockholm and influenced the final policy design choices. This study introduces a sequential experimental game to study reactions to congestion pricing in the commercial sector. In the game, merchants first make location choices. Consumers, who drive to do their shopping, subsequently choose where to shop. Initial responses to the introduction of congestion pricing and equilibrium selection adjustments over time are observed. These observations are compared to responses and adjustments in a condition where congestion pricing is reduced from an initially high level. Payoffs are non-linear and non-transparent, making it less than obvious that the efficient equilibrium will be selected, and introducing possibilities that participants need to discover their preferences and anchor on past experiences. We find that initial responses reflect standard inverse price-demand relations, and that adjustments over time rely on signaling by consumers leading to the efficient equilibrium. There is also evidence that priming from initial experiences influence play somewhat. We confirm that commercial activities relocate following the introduction of congestion pricing and that the adjustment process is costly to merchants.
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| 9. |
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| 10. |
- Grune-Yanoff, Till, et al.
(författare)
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Beneficial safety decreases
- 2011
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Ingår i: Theory and Decision. - : Springer Nature. - 0040-5833 .- 1573-7187. ; 70:2, s. 195-213
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Tidskriftsartikel (refereegranskat)abstract
- We construct a model of rational choice under risk with biased risk judgement. On its basis, we argue that sometimes, a regulator aiming at maximising social welfare should affect the environment in such a way that it becomes 'less safe' in common perception. More specifically, we introduce a bias into each agent's choice of optimal risk levels: consequently, in certain environments, agents choose a behaviour that realises higher risks than intended. Individuals incur a welfare loss through this bias. We show that by deteriorating the environment, the regulator can motivate individuals to choose behaviour that is less biased, and hence realises risk levels closer to what individuals intended. We formally investigate the conditions under which such a Beneficial Safety Decrease-i.e. a deteriorating intervention that has a positive welfare effect-exists. Finally, we discuss three applications of our model.
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