A consistency test of the time trade-off

Han Bleichrodt, José Luis Pinto and Jose-Maria Abellan-Perpiñan ()

Economics Working Papers from Department of Economics and Business, Universitat Pompeu Fabra

Abstract: This paper tests the internal consistency of time trade-off utilities. We find significant violations of consistency in the direction predicted by loss aversion. The violations disappear for higher gauge durations. We show that loss aversion can also explain that for short gauge durations time trade-off utilities exceed standard gamble utilities. Our results suggest that time trade-off measurements that use relatively short gauge durations, like the widely used EuroQol algorithm (Dolan 1997), are affected by loss aversion and lead to utilities that are too high.

Keywords: Cost-Utility Analysis; Time Trade-Off; Loss Aversion (search for similar items in EconPapers)
JEL-codes: I10 (search for similar items in EconPapers)
Date: 2003-03
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (19)

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Journal Article: A consistency test of the time trade-off (2003)
Working Paper: A consistency test of the time trade-off (2003)
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Persistent link: https://EconPapers.repec.org/RePEc:upf:upfgen:676

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