@techreport{e4424aaf139b44a585614cd08baa0a9a,

title = "Probability Judgements in Multi-Stage Problems: Experimental Evidence of Systematic Biases",

abstract = "We report empirical evidence that in problems of random walk with positive drift, bounded rationality leads individuals to under-estimate the probability of success in the long run.In particular, individuals who were given the stage by stage probability distribution failed to aggregate this information in a multi-stage case.Estimations of the long run probability distribution did not differ much from the given stage-by-stage probability distribution, and were systematically lower than the accurate one.Applications to risk perception in financial markets are considered",

keywords = "bounded rationality, Probability, random walks, Estimation",

author = "U. Gneezy",

note = "Pagination: 16",

year = "1996",

language = "English",

volume = "1996-01",

series = "CentER Discussion Paper",

publisher = "Microeconomics",

type = "WorkingPaper",

institution = "Microeconomics",

}