Abstract

  


 



Transitive Regret Over Statistically Independent Lotteries


Sushil Bikhchandani


University of California, Los Angeles - Anderson School of Management

Uzi Segal


Boston College - Department of Economics
March 31, 2012


Abstract:     
Preferences may arise from regret, i.e., from comparisons with alternatives forgone by the decision maker. We show that when the choice set consists of pairwise statistically independent lotteries, transitive regret-based behavior is consistent with betweenness preferences and with a family of preferences that is characterized by a consistency property. Examples of consistent preferences include CARA, CRRA, and anticipated utility.

Number of Pages in PDF File: 17

Keywords: regret, transitivity, non-expected utility

JEL Classification: D81

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Date posted: April 19, 2012  

Suggested Citation

Bikhchandani, Sushil and Segal, Uzi, Transitive Regret Over Statistically Independent Lotteries (March 31, 2012). Available at SSRN: http://ssrn.com/abstract=2042791 or http://dx.doi.org/10.2139/ssrn.2042791

Contact Information

Sushil Bikhchandani (Contact Author)
University of California, Los Angeles - Anderson School of Management ( email )
Policy Area
110 Westwood Plaza
Los Angeles, CA 90095
United States
310-206-2686 (Phone)
310-825-1581 (Fax)
Uzi Segal
Boston College - Department of Economics ( email )
140 Commonwealth Avenue
Chestnut Hill, MA 02467
United States
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