The Relation between Behavior under Risk and over Time
Yoram Halevy () and
American Economic Review: Insights, 2020, vol. 2, issue 1, 1-16
The paper establishes a tight relation between nonstandard behaviors in the domains of risk and time, by considering a decision-maker with non-expected utility preferences who believes that only present consumption is certain while any future consumption is uncertain. We provide the first complete characterizations of the two-way relations between the certainty effect and present bias, and between the common ratio effect and temporal reversals.
JEL-codes: D11 D15 D81 D91 (search for similar items in EconPapers)
Note: DOI: 10.1257/aeri.20190051
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Working Paper: The Relation between Behavior under Risk and over Time (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:aea:aerins:v:2:y:2020:i:1:p:1-16
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