 An experimental test of the under-annuitization puzzle with smooth ambiguity and charitable givingHippolyte d'Albis, Giuseppe Attanasi and Emmanuel Thibault Post-Print from HAL Abstract: In a life-cycle model with a bequest motive, we study the impact of smooth ambiguity aversion to uncertain survival probabilities on the optimal demand for annuities. We implement a theory-driven laboratory experiment. First, a subject's ambiguity attitude is elicited in a simple experimental setting able to make the smooth ambiguity model operational. Then, in a two-period annuity-bequest decision problem, the subject's bequest in the second period is presented as a donation to a previously chosen charity, contingent to the subject being active after the first period. In line with the theoretical predictions, we find that ambiguity-averse (resp., loving) subjects invest less (resp., more) in annuities than ambiguity-neutral ones. Furthermore, subjects' contingent donation to the chosen charity increases in their investment in annuities only for sufficiently high levels of warm-glow altruism. Date: 2020 Published in Journal of Economic Behavior and Organization, 2020, 180, pp.694-717. ⟨10.1016/j.jebo.2019.09.019⟩ There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it. Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:halshs-02398675 DOI: 10.1016/j.jebo.2019.09.019 Access Statistics for this paper More papers in Post-Print from HAL |
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