Low-probability Insurance Decisions with Ambiguity: the Role of Concern
نویسندگان
چکیده
On the basis of a low probability insurance experiment with substantial money on the line, we demonstrate that concern is an important driver of willingness to pay (WTP) for insurance when there is ambiguity surrounding the estimate. Concern still plays an important role when probabilities are given precisely. This finding explains why some individuals pay too much and others little for insurance coverage. 3
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