Eliciting Subjective Probabilities with Binary Lotteries

Glenn W. Harrison, Jimmy Martínez-Correa, J. Todd Swarthout

Publikation: Working paperForskning

Abstrakt

We evaluate the binary lottery procedure for inducing risk neutral behavior in a subjective belief elicitation task. Harrison, Martínez-Correa and Swarthout [2013] found that the binary lottery procedure works robustly to induce risk neutrality when subjects are given one risk task defined over objective probabilities. Drawing a sample from the same subject population, we find evidence that the binary lottery procedure induces linear utility in a subjective probability elicitation task using the Quadratic Scoring Rule. We also show that the binary lottery procedure can induce direct revelation of subjective probabilities in subjects with certain Non-Expected Utility preference representations that satisfy weak conditions that we identify.
OriginalsprogEngelsk
Udgivelses stedAtlanta, GA
UdgiverCEAR, Georgia State University
Antal sider50
StatusUdgivet - 2012
NavnWorking paper / Center for Economic Analysis of Risk (CEAR)
Nummer2012-09

Emneord

  • Subjective Probability Elicitation
  • Binary Lottery Procedure
  • Experimental Economies
  • Risk Neutrality

Citationsformater