Revealing Choice Bracketing
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arXiv
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| Hauptverfasser: | , |
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| Format: | Preprint |
| Veröffentlicht: |
2020
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| _version_ | 1866916152949604352 |
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| author | Ellis, Andrew Freeman, David J. |
| author_facet | Ellis, Andrew Freeman, David J. |
| contents | Experiments suggest that people fail to take into account interdependencies between their choices -- they do not broadly bracket. Researchers often instead assume that people narrowly bracket, but existing designs do not test it. We design a novel experiment and revealed preference tests for how someone brackets their choices. In portfolio allocation under risk, social allocation, and induced-value shopping experiments, 40-43% of subjects are consistent with narrow bracketing and 0-16% with broad bracketing. Adjusting for each model's predictive precision, 74% of subjects are best described by narrow bracketing, 13% by broad bracketing, and 6% by intermediate cases. |
| format | Preprint |
| id |
arxiv_https___arxiv_org_abs_2006_14869 |
| institution | arXiv |
| publishDate | 2020 |
| record_format | arxiv |
| spellingShingle | Revealing Choice Bracketing Ellis, Andrew Freeman, David J. Theoretical Economics Experiments suggest that people fail to take into account interdependencies between their choices -- they do not broadly bracket. Researchers often instead assume that people narrowly bracket, but existing designs do not test it. We design a novel experiment and revealed preference tests for how someone brackets their choices. In portfolio allocation under risk, social allocation, and induced-value shopping experiments, 40-43% of subjects are consistent with narrow bracketing and 0-16% with broad bracketing. Adjusting for each model's predictive precision, 74% of subjects are best described by narrow bracketing, 13% by broad bracketing, and 6% by intermediate cases. |
| title | Revealing Choice Bracketing |
| topic | Theoretical Economics |
| url | https://arxiv.org/abs/2006.14869 |