Experiments on Decisions under Risk: The Expected Utility Hypothesis

  • Paul J. H. Schoemaker

Table of contents

  1. Front Matter
    Pages i-xxiii
  2. Paul J. H. Schoemaker
    Pages 1-10
  3. Paul J. H. Schoemaker
    Pages 11-27
  4. Paul J. H. Schoemaker
    Pages 28-44
  5. Paul J. H. Schoemaker
    Pages 45-65
  6. Paul J. H. Schoemaker
    Pages 66-90
  7. Paul J. H. Schoemaker
    Pages 91-108
  8. Paul J. H. Schoemaker
    Pages 109-125
  9. Paul J. H. Schoemaker
    Pages 126-139
  10. Back Matter
    Pages 141-211

About this book

Introduction

In this valuable book, Paul Schoemaker summarizes recent experimental and field research that he and others have undertaken regarding the descrip­ tive validity of expected utility theory as a model of choice under uncer­ tainty. His principal message is that this paradigm is too narrow in its con­ ception and misses some of the important elements of a descriptive model of individual choice. In particular, Schoemaker calls attention to the impor­ tance of individual differences, task effects, and context effects as they influence behavior. The expected utility hypothesis has come under scrutiny in recent years from a number of different quarters. This book brings together these many studies and relates them to the large body of literature on individual de­ cision making under risk. Although this paradigm may be appropriate for describing behavior under many conditions of uncertainty, Schoemaker presents convincing evidence that it does not do well with respect to protec­ tion against low-probability events. For example, he shows that the insur­ ance purchase decision is influenced by the way information is presented to the client, as well as by the statistical knowledge of the respondents.

Keywords

European Union (EU) information insurance probability research utility utility theory

Authors and affiliations

  • Paul J. H. Schoemaker
    • 1
  1. 1.Graduate School of Business, Center for Decision ResearchUniversity of ChicagoUSA

Bibliographic information

  • DOI https://doi.org/10.1007/978-94-017-5040-0
  • Copyright Information Springer Science+Business Media B.V. 1980
  • Publisher Name Springer, Dordrecht
  • eBook Packages Springer Book Archive
  • Print ISBN 978-94-017-5042-4
  • Online ISBN 978-94-017-5040-0
  • About this book