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Dynamic choice, independence and emotionsold_uid | 2322 |
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title | Dynamic choice, independence and emotions |
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start_date | 2007/03/02 |
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schedule | 10h |
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online | no |
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summary | From the viewpoint of the independence axiom of expected utility theory, an
interesting empirical dynamic choice problem involves the presence of a “global
risk”, that is, a chance of losing everything whichever safe or risky option is
chosen. In this experimental study, participants have to allocate real money
between a safe and a risky pro ject. Treatment variable is the particular decision
stage at which a global risk is resolved: (i) before the investment decision; (ii) after
the investment decision but before the resolution of the investment risk; (iii) after
the resolution of the investment risk. The baseline treatment is without global
risk. Our goal is to investigate the isolation effect and the principle of timing
independence under the different timing options of the global risk. In addition,
we examine the role played by anticipated and experienced emotions in the choice
problem. Main findings are a violation of the isolation effect, and support for the
principle of timing independence. Although behavior across the different global
risk cases shows similarities, we observe clear differences in people’s affective
responses. This may be responsible for the conflicting results observed in earlier
experiments. Dependent on the timing of the global risk different combinations
of anticipated and experienced emotions influence decision making. |
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responsibles | Bourgeois-Gironde |
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