On the Experimental Robustness of the Allais Paradox

B-Tier
Journal: American Economic Journal: Microeconomics
Year: 2022
Volume: 14
Issue: 1
Pages: 143-63

Score contribution per author:

0.670 = (α=2.01 / 3 authors) × 1.0x B-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

The Allais Paradox, or the common consequence effect, is a well-known behavioral regularity in individual decision-making under risk. Data from 81 experiments reported in 29 studies reveal that the Allais Paradox is a fragile empirical finding. The Allais Paradox is likely to be observed in experiments with high hypothetical payoffs, the medium outcome being close to the highest outcome and when lotteries are presented as a probability distribution (not in a compound form). The Allais Paradox is likely to be reversed in experiments when the probability mass is equally split between the lowest and highest outcomes in risky lotteries.

Technical Details

RePEc Handle
repec:aea:aejmic:v:14:y:2022:i:1:p:143-63
Journal Field
General
Author Count
3
Added to Database
2026-01-26