Journal of Risk and Uncertainty

, Volume 10, Issue 3, pp 223–233 | Cite as

Willingness-to-pay and willingness-to-accept for risky and ambiguous lotteries

  • Roselies Eisenberger
  • Martin Weber
Article

Abstract

Former studies have shown that people tend to give buying prices that are lower than selling prices. In our study, we investigate if this willingness-to-accept and willingness-to-pay disparity is affected by ambiguity. Using a Becker, DeGroot, and Marschak procedure, we elicit buying, selling, short-selling, and short-buying prices. The results indicate that subjects clearly distinguish between risky and ambiguous lotteries and the different ways in which lotteries are framed. However, the average WTA/WTP ratios are remarkably close for all lotteries considered, as well as for negative and positive framing.

Key words

ambiguity endowment experimental economics 

JEL code

D81 

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Copyright information

© Kluwer Academic Publishers 1995

Authors and Affiliations

  • Roselies Eisenberger
    • 1
  • Martin Weber
    • 1
  1. 1.Lehrstuhl für ABWL, Finanzwirtschaft, insb. BankbetriebslehreUniversität Mannheim, L 5, 2MannheimGermany

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