On preference imprecision

Cubitt, Robin P.; Navarro-Martinez, Daniel; Starmer, Chris

Abstract

Recent research invokes preference imprecision to explain violations of individual decision theory. While these inquiries are suggestive, the nature and significance of such imprecision remain poorly understood. We explore three questions using a new measurement tool in an experimental investigation of imprecision in lottery valuations: Does such preference imprecision vary coherently with lottery structure? Is it stable on repeat measurement? Does it have explanatory value for economic behaviour? We find that imprecision behaves coherently, shows no tendency to change systematically with experience, is related to choice variability, but is not a main driver of the violations of standard decision theory that we consider.

• Journal Article Type: Article
• Publication Date: Feb 20, 2015
• Journal: Journal of Risk and Uncertainty
• Print ISSN: 0895-5646
• Electronic ISSN: 0895-5646
• Publisher: Humana Press
• Peer Reviewed: Peer Reviewed
• Volume: 50
• Issue: 1
• APA6 Citation: Cubitt, R. P., Navarro-Martinez, D., & Starmer, C. (2015). On preference imprecision. Journal of Risk and Uncertainty, 50(1), doi:10.1007/s11166-015-9207-6
• DOI: https://doi.org/10.1007/s11166-015-9207-6
• Keywords: Preference imprecision, imprecision intervals, noisy preferences, violations of expected utility theory, construct validity
• Publisher URL: http://link.springer.com/article/10.1007/s11166-015-9207-6/fulltext.html
• Copyright Statement: Copyright information regarding this work can be found at the following address: http://creativecommons.org/licenses/by/4.0