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Violence and risk preference: experimental evidence from Afghanistan: comment

Vieider, F. M. (2018) Violence and risk preference: experimental evidence from Afghanistan: comment. American Economic Review, 108 (8). pp. 2366-2382. ISSN 0002-8282

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To link to this item DOI: 10.1257/aer.20160789

Abstract/Summary

In this comment on Callen et al. (2014), I revisit recent evidence uncovering a "preference for certainty" in violation of dominant normative and descriptive theories of decision-making under risk. I show that the empirical findings are potentially confounded by systematic noise. I then develop choice lists that allow me to disentangle these different explanations. Experimental results obtained with these lists reject explanations based on a preference for certainty in favor of explanations based on random choice. From a theoretical point of view, the levels of risk aversion detected in the choice list involving certainty can be accounted for by prospect theory through reference dependence activated by salient outcomes.

Item Type:Article
Refereed:Yes
Divisions:Faculty of Arts, Humanities and Social Science > School of Politics, Economics and International Relations > Economics
ID Code:78483
Uncontrolled Keywords:Economics and Econometrics
Publisher:American Economic Association

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