INVESTIGATING GENERALIZATIONS OF EXPECTED UTILITY THEORY USING EXPERIMENTAL DATA

John D. Hey and Chris Orme ()

Chapter 3 in Experiments in Economics:Decision Making and Markets, 2018, pp 63-98 from World Scientific Publishing Co. Pte. Ltd.

Abstract: A number of generalizations of the expected utility preference functional are estimated using experimentally generated data involving 100 pairwise choice questions repeated on two separate occasions. Likelihood ratio tests are conducted to investigate the statistical superiority of the various generalizations, and the Akaike information criterion is used to distinguish between them. The economic superiority of the various generalizations is also explored and the paper concludes that, for many subjects, the superiority of several of the generalizations is not established.

Keywords: Experimental Economics; Risk; Ambiguity; Markets; Auctions; Bargaining; Econometrics; Methodology (search for similar items in EconPapers)
JEL-codes: C90 (search for similar items in EconPapers)
Date: 2018
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Related works:
Journal Article: Investigating Generalizations of Expected Utility Theory Using Experimental Data (1994)
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