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Intra-experimental income effects and risk aversion

Authors
Journal
Economics Letters
0165-1765
Publisher
Elsevier
Publication Date
Volume
30
Issue
2
Identifiers
DOI: 10.1016/0165-1765(89)90045-1

Abstract

Abstract Harrison's (1986) modification of the Bekker, DeGroot and Marshak (1964) mechanism for eliciting risk preferences is employed to test the hypotheses of expected utility theory (with respect to changes in income): increasing relative risk aversion and decreasing absolute risk aversion. Subjects in the laboratory are shown to exhibit such behavior.

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