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Probabilities of choices among very similar objects: An experiment to decide between two models
Author(s) -
Becker Gordon M.,
Degroot Morris H.,
Marschak Jacob
Publication year - 2007
Publication title -
behavioral science
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.371
H-Index - 45
eISSN - 1099-1743
pISSN - 0005-7940
DOI - 10.1002/bs.3830080403
Subject(s) - preference , test (biology) , mathematics , psychology , statistics , paleontology , biology
If a person who is offered a choice between a cup of tea and a cup of coffee on several occasions chooses tea more often, we can say that he prefers tea to coffee. Suppose this person is approached with a tray on which he sees one cup of tea and two cups of coffee. Is it conceivable that in several such situations he will choose a cup of coffee more frequently than a cup of tea? We feel not. Yet a reasonable model of probabilistically defined preference implies that he might do just that (roughly because if his choices were entirely random, the probability of choosing coffee in the 3‐cup offer would be twice that of choosing tea). This somewhat paradoxical conclusion is put to a test in an experiment where “wagers,” for which the subjects are assumed to have different (probabilistically defined) preferences, take the place of cups with tea and coffee.