Footnote:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments November 16, 2012 erstellt
Description:
This paper examines systematically the attitude towards compound lottery by introducing three variants of symmetric uniform mean-preserving spread into stage-1 risk in a choice-based experimental setting. We do not observe consistent aversion to mean-preserving spread in the stage-1 risk. More importantly, the observed behavioral patterns reject a number of axioms including reduction of compound lotteries, time neutrality, and stage-1 betweenness (independence), which sheds light on related recursive utility models. The overall data support two-stage rank-dependent utility with distinct convex probability weighting functions in two stages