Measuring Ambiguity Preferences: A New Ambiguity Preference Survey Module

Abstract

Ambiguity preferences are important to explain human decision-making in many areas in economics and finance. To measure individual ambiguity preferences, the experimental economics literature advocates using incentivized laboratory experiments. Yet, laboratory experiments are costly, time-consuming and require substantial administrative effort. This study develops an experimentally validated ambiguity preference survey module that can reliably measure ambiguity preferences when carrying out laboratory experiments is impractical. This toolkit may have wide applications, including end-of-session lab questionnaires, large scale surveys and financial client assessments.

Keywords: ambiguity, preference measurement, decision making, experimental economics, survey validation

JEL Classification: C81, C83, C91, D81