The purpose of this project is to experimentally determine the parameters in almost stochastic dominance (ASD). ASD established by Leshno and Levy (2002) has attracted much attention in the finance and economics literature recently. Estimating the parameters in ASD is very important since the values of the parameters in ASD, which characterize the set of most decision makers, are critical to concluding the findings while applying the rules of ASD in the empirical studies. I will theoretically explain the relative sizes of the preference parameters, and show the relationship between these parameters and the well-known degree of absolute risk aversion and degree of absolute prudence. I will further experimentally estimate the value of these parameters. The experimental lotteries are constructed in the spirit of "combining good with bad". Whether decision makers view the domain of gains and losses differently is also examined.
|Effective start/end date||1/08/15 → 31/10/16|
Explore the research topics touched on by this project. These labels are generated based on the underlying awards/grants. Together they form a unique fingerprint.