Detection, Identification, and Estimation of Loss Aversion: Evidence from an Auction Experiment

• 成果类型: Article
• 署名作者: Banerji, A.; Gupta, Neha
• 署名单位: University of Delhi; Delhi School of Economics
• 刊物名称: AMERICAN ECONOMIC JOURNAL-MICROECONOMICS
• ISSN/ISSBN: 1945-7669
• DOI: 10.1257/mic.6.1.91
• 发表日期: 2014
• 页码: 91-133
• 关键词: reference-dependent preferences; prospect-theory; expectations; exchange; models

摘要

We provide a novel experimental auction design, in which (i) an exogenous decrease in the probability of winning, conditional on the bid, reduces the optimal bid of a loss averse agent whose reference point is expectations based; (ii) observed bid distributions uniquely identify the participants' latent value distribution and loss-aversion parameter. Experimental evidence affirms the presence of such reference points. We show that at the estimated magnitudes of loss aversion, (a) conventional Becker, DeGroot, and Marschak (1964) experiments may lead to large biases in estimated willingness to pay (which our design can correct for); and (b) first-price auctions may fetch moderately higher revenue, compared with second-price auctions.