A Reconsideration of Common Ratio Effect and Probability Weighting

Last registered on August 12, 2021
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Pre-Trial

Trial Information

General Information

Title
A Reconsideration of Common Ratio Effect and Probability Weighting
RCT ID
AEARCTR-0008058
Initial registration date
August 11, 2021

Initial registration date is when the trial was registered.

It corresponds to when the registration was submitted to the Registry to be reviewed for publication.

First published
August 12, 2021, 2:04 PM EDT

First published corresponds to when the trial was first made public on the Registry after being reviewed.

Locations

Country
United States of America
Region

Primary Investigator

Name
Charles Sprenger
Affiliation
Caltech
Contact Primary Investigator

Other Primary Investigator(s)

PI Name
Ted O'Donoghue
PI Affiliation
Cornell
Contact Investigator
PI Name
Christina McGranahan
PI Affiliation
University of Delaware
Contact Investigator
PI Name
Jason Somerville
PI Affiliation
Federal Reserve
Contact Investigator
PI Name
Kirby Nielsen
PI Affiliation
Caltech
Contact Investigator

Additional Trial Information

Status
In development
Start date
2021-08-12
End date
2021-10-01
Keywords
Behavior
Additional Keywords
JEL code(s)
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Abstract
This project is motivated by the wide body of research documenting and rationalizing deviations from Expected Utility (EU) in lottery choices. Among the most prominent apparent deviations is the Common Ratio Effect (CRE) initially documented by Allais. We explore the mechanisms behind these effects.
External Link(s)

Registration Citation

Citation
McGranahan, Christina et al. 2021. "A Reconsideration of Common Ratio Effect and Probability Weighting." AEA RCT Registry. August 12. https://doi.org/10.1257/rct.8058-1.0
Sponsors & Partners
Experimental Details

Interventions

Intervention(s)
This project is motivated by the wide body of research documenting and rationalizing deviations from Expected Utility (EU) in lottery choices. Among the most prominent apparent deviations is the Common Ratio Effect (CRE) initially documented by Allais. We explore the mechanisms behind these effects. Subjects will make choices between lotteries.
Intervention Start Date
2021-08-12
Intervention End Date
2021-10-01

Primary Outcomes

Primary Outcomes (end points)
Valuations of lotteries.
Primary Outcomes (explanation)
See uploaded document for analysis plan.

Secondary Outcomes

Secondary Outcomes (end points)
See uploaded document for analysis plan.
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
Experimental subjects will make choices between lotteries.
Experimental Design Details
See uploaded document for design details and analysis plan.
Randomization Method
Randomization by computer for both lotteries faced and outcomes.
Randomization Unit
Individual
Was the treatment clustered?
No

Experiment Characteristics

Sample size: planned number of clusters
900 Individuals
Sample size: planned number of observations
900 Individuals
Sample size (or number of clusters) by treatment arms
300 per treatment arm.
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
See uploaded document for evaluation of detectable effect sizes.
Supporting Documents and Materials
IRB

Institutional Review Boards (IRBs)

IRB Name
Caltech
IRB Approval Date
2021-03-26
IRB Approval Number
21-1073
Analysis Plan

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Post-Trial

Post Trial Information

Study Withdrawal

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Intervention

Is the intervention completed?
No
Data Collection Complete
Data Publication

Data Publication

Is public data available?
No

Program Files

Program Files
Reports, Papers & Other Materials

Relevant Paper(s)

Reports & Other Materials