Separating Bayesian Updating from Non-Probabilistic Reasoning: An Experimental Investigation

Dan Levin (), James Peck and Asen Ivanov ()

No 776, Working Papers from Queen Mary University of London, School of Economics and Finance

Abstract: Through a series of decision tasks involving coloured cards, we provide separate measures of Bayesian updating and non-probabilistic reasoning skills. We apply these measures to (and are the first to study) a common-value Dutch auction. This format is more salient than the strategically equivalent first-price auction and silent Dutch formats in hinting that one should condition one's estimate of the value on having the highest bid. Both Bayesian updating skills and non-probabilistic reasoning skills are shown to help subjects correct for the winner's curse, as does the saliency of the active-clock Dutch format.

Keywords: Bayesian updating; Non-probabilistic reasoning; Dutch auction (search for similar items in EconPapers)
JEL-codes: D4 D7 D8 (search for similar items in EconPapers)
Date: 2015-12-20
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Journal Article: Separating Bayesian Updating from Non-Probabilistic Reasoning: An Experimental Investigation (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:qmw:qmwecw:776

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