Revealing a preference for mixtures: An experimental study of risk | Academic Article individual record
abstract

Using a revealed preference approach, we conduct an experiment where subjects make choices from linear convex budgets in the domain of risk. We find that many individuals prefer mixtures of lotteries in ways that systematically rule out expected utility behavior. We explore the extent to which an individual's preference to choose mixtures is related to a preference for randomization by comparing choices from a convex choice task to the decisions made in a repeated discrete choice task. We find that a preference to mix is positively correlated with behavior from repeated discrete choice tasks.

authors
publication outlet

Quantitative Economics

author list (cited authors)
Feldman, P., & Rehbeck, J.
publication date
2022
publisher
keywords
  • Preference For Randomization
  • Stochastic Choice
  • Risk Preferences
  • Revealed Preferences
identifier
657334SE
Digital Object Identifier (DOI)
start page
761
end page
786
volume
13
issue
2