Affiliation:
1. MIT Economics (email: )
Abstract
We present a speculative application of model estimates from Fudenberg and Puri (2021) to prize-linked savings in South Africa. The models used include one combining simplicity theory (Puri 2018, 2022), a preference for lotteries with fewer possible outcomes, with cumulative prospect theory. The results and those of prior literature indicate that both simplicity and probability weighting have a role to play in understanding behavior in choice under risk. We discuss the properties of these models and their implications for behavior.
Publisher
American Economic Association
Reference15 articles.
1. Andreoni, James, and Charles Sprenger. 2011. "Uncertainty Equivalents: Testing the Limits of the Independence Axiom." NBER Working Paper 17342.
2. Gertler, Paul, Sean Higgins, Aisling Scott, and Enrique Seira. 2018. "The Long-Term Effects of Temporary Incentives to Save: Evidence from a Prize-Linked Savings Field Experiment." https://www.povertyactionlab.org/sites/ default/ les/publications/Long-Term-Effectof-Temporary-of-Incentivs-to-Save_Gertler. et_.al_March2018.pdf.
3. Goodman, Aaron, and Indira Puri. 2021. "Arbitrage in the Binary Option Market: Distinguishing Behavioral Biases." https://economics.mit. edu/files/22713.
4. Allais for all: Revisiting the paradox in a large representative sample
5. Prospect Theory: An Analysis of Decision under Risk
Cited by
5 articles.
订阅此论文施引文献
订阅此论文施引文献,注册后可以免费订阅5篇论文的施引文献,订阅后可以查看论文全部施引文献