Testing the Intransitivity Explanation of the Allais Paradox

Theory and Decision 47 (3):229-245 (1999)
  Copy   BIBTEX

Abstract

This paper uses a two-dimensional version of a standard common consequence experiment to test the intransitivity explanation of Allais-paradox-type violations of expected utility theory. We compare the common consequence effect of two choice problems differing only with respect to whether alternatives are statistically correlated or independent. We framed the experiment so that intransitive preferences could explain violating behavior when alternatives are independent, but not when they are correlated. We found the same pattern of violation in the two cases. This is evidence against intransitivity as an explanation of the Allais Paradox. The question whether violations of expected utility are mainly due to intransitivity or to violation of independence is important since it is exactly on this issue the main new decision theories differ

Links

PhilArchive



    Upload a copy of this work     Papers currently archived: 93,642

External links

Setup an account with your affiliations in order to access resources via your University's proxy server

Through your library

Similar books and articles

Towards a positive theory of preferences under risk.Ole Hagen - 1979 - In Maurice Allais & Ole Hagen (eds.), Expected Utility Hypotheses and the Allais Paradox. D. Reidel. pp. 271--302.
Counterfactual Desirability.Richard Bradley & H. Orii Stefansson - 2017 - British Journal for the Philosophy of Science 68 (2):485-533.

Analytics

Added to PP
2010-09-02

Downloads
69 (#82,832)

6 months
13 (#1,035,185)

Historical graph of downloads
How can I increase my downloads?

Citations of this work

No citations found.

Add more citations

References found in this work

The Foundations of Statistics.Leonard J. Savage - 1954 - Wiley Publications in Statistics.
Theory of Games and Economic Behavior.John Von Neumann & Oskar Morgenstern - 1944 - Princeton, NJ, USA: Princeton University Press.
The Foundations of Statistics.Leonard J. Savage - 1956 - Philosophy of Science 23 (2):166-166.

View all 7 references / Add more references