Nielsen, Kirby and Rehbeck, John (2019) When Choices are Mistakes. . (Unpublished) https://resolver.caltech.edu/CaltechAUTHORS:20200727-123702668
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Abstract
Using a laboratory experiment, we identify whether decision makers consider it a mistake to violate canonical choice axioms. To do this, we incentivize subjects to report which of several axioms they want their decisions to satisfy. Then, subjects make lottery choices which might conflict with their stated axiom preferences. We give them the opportunity to re-evaluate their decisions when lotteries conflict with desired axioms. We find that a majority of individuals want to follow the axioms and revise their lottery choices to be consistent with them. We interpret this to mean that most axiom violations in our sample were mistakes.
| Item Type: | Report or Paper (Working Paper) | ||||||
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| Additional Information: | We thank Dan Benjamin, Doug Bernheim, Paul Feldman, Tzachi Gilboa, Paul J. Healy, Miles Kimball, Muriel Niederle, Ryan Oprea, Collin Raymond, Frank Schilbach, Joel Sobel, and Colin Sullivan for many helpful comments and suggestions. A previous version of this paper was circulated with the title “Are Axioms Normative? Eliciting Axiom Preferences and Resolving Conflicts with Lottery Choices.” This study was approved by the Institutional Review Boards at Stanford University and The Ohio State University. | ||||||
| Subject Keywords: | mistakes; rationality; normative versus descriptive theory; procedural decision making | ||||||
| Classification Code: | JEL: C90, D01, D60, D80 | ||||||
| Record Number: | CaltechAUTHORS:20200727-123702668 | ||||||
| Persistent URL: | https://resolver.caltech.edu/CaltechAUTHORS:20200727-123702668 | ||||||
| Official Citation: | Nielsen, Kirby and Rehbeck, John, When Choices are Mistakes (November 5, 2019). Available at SSRN: https://ssrn.com/abstract=3481381 or http://dx.doi.org/10.2139/ssrn.3481381 | ||||||
| Usage Policy: | No commercial reproduction, distribution, display or performance rights in this work are provided. | ||||||
| ID Code: | 104595 | ||||||
| Collection: | CaltechAUTHORS | ||||||
| Deposited By: | Tony Diaz | ||||||
| Deposited On: | 28 Jul 2020 20:20 | ||||||
| Last Modified: | 28 Jul 2020 20:20 |
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