Eliciting risk preferences using choice lists

David Freeman, Yoram Halevy and Terri Kneeland

Quantitative Economics, 2019, vol. 10, issue 1, 217-237

Abstract: We study the effect of embedding pairwise choices between lotteries within a choice list on measured risk attitude. Using an experiment with online workers, we find that subjects choose the risky lottery rather than a sure payment significantly more often when responding to a choice list. This behavior can be rationalized by the interaction between nonexpected utility and the random incentive system, as suggested by Karni and Safra ().

Date: 2019
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https://doi.org/10.3982/QE856

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Working Paper: Eliciting Risk Preferences Using Choice Lists (2018)
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