Allais for all

Revisiting the paradox in a large representative sample

S. Huck, W. Müller

Research output: Contribution to journalArticleScientific

Abstract

We administer the Allais paradox questions to both a representative sample of the Dutch population and to student subjects. Three treatments are implemented: one with the original high hypothetical payoffs, one with low hypothetical payoffs and a third with low real payoffs. Our key findings are: (i) violations in the non-lab sample are systematic and a large bulk of violations is likely to stem from non-familiarity with large payoffs, (ii) we can identify groups of the general population that have much higher than average violation rates; this concerns mainly the lowly educated and unemployed, and (iii) the relative treatment differences in the population at large are accurately predicted by the lab sample, but violation rates in all lab treatments are about 15 percentage points lower than in the corresponding non-lab treatments.
Original languageEnglish
Pages (from-to)261-293
JournalJournal of Risk and Uncertainty
Volume44
Issue number3
Publication statusPublished - 2012

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Violations
Paradox
Allais paradox
General population

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abstract = "We administer the Allais paradox questions to both a representative sample of the Dutch population and to student subjects. Three treatments are implemented: one with the original high hypothetical payoffs, one with low hypothetical payoffs and a third with low real payoffs. Our key findings are: (i) violations in the non-lab sample are systematic and a large bulk of violations is likely to stem from non-familiarity with large payoffs, (ii) we can identify groups of the general population that have much higher than average violation rates; this concerns mainly the lowly educated and unemployed, and (iii) the relative treatment differences in the population at large are accurately predicted by the lab sample, but violation rates in all lab treatments are about 15 percentage points lower than in the corresponding non-lab treatments.",
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Allais for all : Revisiting the paradox in a large representative sample. / Huck, S.; Müller, W.

In: Journal of Risk and Uncertainty, Vol. 44, No. 3, 2012, p. 261-293.

Research output: Contribution to journalArticleScientific

TY - JOUR

T1 - Allais for all

T2 - Revisiting the paradox in a large representative sample

AU - Huck, S.

AU - Müller, W.

N1 - Appeared earlier as CentER Discussion Paper 2007-099 (in elk geval submitted in 2012, onduidelijk of het is geaccepteerd)

PY - 2012

Y1 - 2012

N2 - We administer the Allais paradox questions to both a representative sample of the Dutch population and to student subjects. Three treatments are implemented: one with the original high hypothetical payoffs, one with low hypothetical payoffs and a third with low real payoffs. Our key findings are: (i) violations in the non-lab sample are systematic and a large bulk of violations is likely to stem from non-familiarity with large payoffs, (ii) we can identify groups of the general population that have much higher than average violation rates; this concerns mainly the lowly educated and unemployed, and (iii) the relative treatment differences in the population at large are accurately predicted by the lab sample, but violation rates in all lab treatments are about 15 percentage points lower than in the corresponding non-lab treatments.

AB - We administer the Allais paradox questions to both a representative sample of the Dutch population and to student subjects. Three treatments are implemented: one with the original high hypothetical payoffs, one with low hypothetical payoffs and a third with low real payoffs. Our key findings are: (i) violations in the non-lab sample are systematic and a large bulk of violations is likely to stem from non-familiarity with large payoffs, (ii) we can identify groups of the general population that have much higher than average violation rates; this concerns mainly the lowly educated and unemployed, and (iii) the relative treatment differences in the population at large are accurately predicted by the lab sample, but violation rates in all lab treatments are about 15 percentage points lower than in the corresponding non-lab treatments.

M3 - Article

VL - 44

SP - 261

EP - 293

JO - Journal of Risk and Uncertainty

JF - Journal of Risk and Uncertainty

SN - 0895-5645

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