Allais for all: Revisiting the paradox in a large representative sample

Allais for all: Revisiting the paradox in a large representative sample

We administer the Allais paradox questions to both a representative sample of the Dutch population and to student subjects. Three treatments are implemented: one with the original high hypothetical payoffs, one with low hypothetical payoffs and a third with low real payoffs. Our key findings are: (i) violations in the non-lab sample are systematic and a large bulk of violations is likely to ste...

Learning in the Allais paradox

Whereas both the Allais paradox, the first empirical challenge of the classical rationality assumptions, and learning have been the focus of many experimental investigations, no experimental study exists today into learning in the pure context of the Allais paradox. This paper presents such a study. We find that choices converge to expected utility maximization if subjects are given the opportu...

Allais paradox pdf

Validation of the Driver Behavior Questionnaire in a Representative Sample of Iranian Drivers

The Driver Behaviour Questionnaire (DBQ) is widely used around the world to investigate driving behaviours. However, it has several different versions extracted from the 50-items Manchester driver behaviour questionnaire for variety of societies. This study aims to calibrate the DBQ for the Iranian driver population and explore their aberrant driver behaviour. In total, 524 participants (325 me...

Self Control, Risk Aversion, and the Allais Paradox

This paper develops a dual-self model that is compatible with modern dynamic macroeconomic theory and evidence, and shows how it leads to a wide range of behavioral anomalies concerning risk, including the Allais paradox. We calibrate the model to obtain a quantitative fit, by extending the simpler “nightclub” model of Fudenberg and Levine [2006] by introducing consumption commitment. We find t...