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Handbook of the Economics of Risk and Uncertainty
book

Handbook of the Economics of Risk and Uncertainty

by Mark Machina, W. Kip Viscusi
November 2013
Beginner content levelBeginner
896 pages
35h 10m
English
North Holland
Content preview from Handbook of the Economics of Risk and Uncertainty
Choice Under Uncertainty: Empirical Methods and Experimental Results
843
random number was the “buying price” for the bet. If the buying price was higher than
the reservation price that the subject stated, she was paid the buying price (and her pay-
off did not depend on the outcome of her bet). However, if the buying price was lower
than the minimal selling price, the actual payment depended on the outcome of her bet.
This BDM technique is well-known in the literature, but is complicated to describe and
difficult for subjects to understand. Moreover there are well-known problems, see Karni
and Safra (1987), with using this technique when prefer ...
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Publisher Resources

ISBN: 9780444536853