Risk attitude in real decision problems

@inproceedings{Botti2008RiskAI,
  title={Risk attitude in real decision problems},
  author={Fabrizio Botti and A. Conte and Daniela Di Cagno and Carlo D'ippoliti},
  year={2008}
}
We use data from 298 showings of the television program "Affari Tuoi," which involves contestants making decisions between risky prospects with possible prizes of up to half a million euros, to estimate three models of decision-making under risk: Expected Utility, Rank-Dependent Expected Utility and Regret-Rejoice. We find that Regret-Rejoice does not significantly improve upon Expected Utility, while Rank-Dependent outperforms it. Interestingly, we find that the CARA specification fits… CONTINUE READING

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