Do trade union leaders violate subjective expected utility? Some insight from experimental data

Anna Maffioletti () and Michele Santoni

Departmental Working Papers from Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano

Abstract: This paper presents the results of two experiments designed to test violations of Subjective Expected Utility Theory (SEUT) within a sample of Italian trade union delegates and leaders. Subjects priced risky and ambiguous prospects in the domain of gains. Risky prospects were based on games of chance, while ambiguous prospects were built on the standard Ellsberg paradox and on event lotteries whose outcomes were based either on the results of a fictional election or on the future results of the 1999 European Parliamentary election in Italy and the UK. The experiments show that, although risky prospects were priced at their expected values on average, trade union delegates and leaders did violate SEUT when assessing ambiguous prospects. Moreover, their behaviour depended on the source of uncertainty (Ellsberg paradox versus electoral results; fictional versus real election; Italy versus UK election outcomes). We discuss the implications of these results for the economic theory of the trade union as regards technological innovation and the unemployed.

Keywords: Ambiguity; Ellsberg���s paradox; Trade unions. (search for similar items in EconPapers)
JEL-codes: D81 J51 (search for similar items in EconPapers)
Date: 2001-01-01
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Related works:
Journal Article: Do Trade Union Leaders Violate Subjective Expected Utility? Some Insights From Experimental Data (2005)
Working Paper: Do Trade Union Leaders Violate Subjective Expected Utility?Some Insights from Experimental Data (2001)
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Persistent link: https://EconPapers.repec.org/RePEc:mil:wpdepa:2001-15

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