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Blavatskyy Ortmann Panchenko (2020) Allais Paradox

Principal Investigator(s): View help for Principal Investigator(s) Pavlo Blavatskyy, Montpellier Business School; Andreas Ortmann, UNSW Business School; Valentyn Panchenko, UNSW Business School

Version: View help for Version V1

Name	File Type	Size	Last Modified
Data files_AEJMicro-2019-0153.R1.zip	application/zip	636.5 KB	05/07/2020 06:49:PM
readme file for AEJ-Micro.docx	application/vnd.openxmlformats-officedocument.wordprocessingml.document	22.6 KB	05/07/2020 06:48:PM

Project Citation:

Blavatskyy, Pavlo , Ortmann, Andreas, and Panchenko, Valentyn . Blavatskyy Ortmann Panchenko (2020) Allais Paradox. Nashville, TN: American Economic Association [publisher], 2020. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2020-05-08. https://doi.org/10.3886/E119324V1

Project Description

Summary: Abstract The Allais Paradox, or the common‐consequence effect, is a well‐known behavioral regularity in individual decision making under risk. Data from 83 experiments reported in 30 studies reveal that the Allais Paradox is a fragile empirical finding. The Allais Paradox is likely to be observed in experiments with high hypothetical payoffs, the medium outcome being close to the highest outcome and when lotteries are presented as a probability distribution (not in a compound form). The Allais Paradox is likely to be reversed in experiments when the probability mass is equally split between the lowest and the highest outcome in risky lotteries.

Scope of Project

Subject Terms: Decision Under Risk; Experimental Practices; Allais Paradox; Common-Consequence Effect; Expected Utility Theory; Fanning-out

JEL Classification:
D01 Microeconomic Behavior: Underlying Principles
D81 Criteria for Decision-Making under Risk and Uncertainty

Time Period(s): 1986 – 2017

Methodology

Collection Mode(s): other

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Published Versions

V2 [2020-11-06]

V1 [2020-05-08]

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