Risk, uncertainty and discrete choice models

de Palma, Andre, Akiva, Moshe Ben, Brownestone, David, Holt, Charles, Magnac, Thierry, McFadden, Daniel, Moffatt, Peter, Picard, Nathalie, Train, Kenneth, Wakker, Peter and Walker, Joan (2008) Risk, uncertainty and discrete choice models. Marketing Letters, 19. pp. 269-295.

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Abstract

This paper examines the cross-fertilizations of random utility models with the study of decision making under risk and uncertainty. We start with a description of the expected utility (EU) theory and then consider deviations from the standard EU frameworks, involving the Allais paradox and the Ellsberg paradox, inter alia. We then discuss how the resulting non-EU framework can be modeled and estimated within the framework of discrete choices in static and dynamic contexts. Our objectives in addressing risk and ambiguity in individual choice contexts are to understand the decision choice process and to use behavioral information for prediction, prescription, and policy analysis.

Item Type:	Article
Faculty \ School:	Faculty of Social Sciences > School of Economics
UEA Research Groups:	Faculty of Social Sciences > Research Centres > Centre for Behavioural and Experimental Social Sciences Faculty of Social Sciences > Research Groups > Applied Econometrics And Finance Faculty of Social Sciences > Research Groups > Behavioural Economics
Depositing User:	Gina Neff
Date Deposited:	13 Jan 2011 11:10
Last Modified:	17 Jun 2024 10:30
URI:	https://ueaeprints.uea.ac.uk/id/eprint/10936
DOI:	10.1007/s11002-008-9047-0

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