OPTIMAL STOPPING IN A DYNAMIC SALIENCE MODEL

• 成果类型: Article
• 署名作者: Dertwinkel-Kalt, Markus; Frey, Jonas
• 署名单位: University of Munster; Max Planck Society; University of Oxford
• 刊物名称: INTERNATIONAL ECONOMIC REVIEW
• ISSN/ISSBN: 0020-6598
• DOI: 10.1111/iere.12681
• 发表日期: 2024
• 页码: 885-913
• 关键词: PROSPECT-THEORY; expected utility; disposition; RISK; REPRESENTATION; CHOICE; long

摘要

We study dynamic choice under risk through the lens of salience theory. We derive predictions on salient thinkers' gambling decisions and strategy choices. We test our model experimentally and find support for all of our predictions. We also detect a strong correlation between static and dynamic choices, suggesting that salience theory can coherently explain risky choice in both static and dynamic contexts. Our results help to understand when people sell assets, stop gambling, enter the job market, or retire.