When diversification clashes with the reinforcement heuristic: An experimental investigation

I experimentally investigate how diversification decisions are affected by information about historical outcomes. In the experiment, subjects have the opportunity to diversify between two simple binary gambles. When subjects lack information about previous outcomes, a vast majority diversify. By con...

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Autores:
Tipo de recurso:
Fecha de publicación:
2020
Institución:
Universidad del Rosario
Repositorio:
Repositorio EdocUR - U. Rosario
Idioma:
eng
OAI Identifier:
oai:repository.urosario.edu.co:10336/22332
Acceso en línea:
https://doi.org/10.1016/j.jebo.2020.04.018
https://repository.urosario.edu.co/handle/10336/22332
Palabra clave:
Beliefs
Diversification
Reinforcement heuristic
Uncertainty
Rights
License
Abierto (Texto Completo)
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repository_id_str
spelling 5453346002020-05-25T23:56:08Z2020-05-25T23:56:08Z2020I experimentally investigate how diversification decisions are affected by information about historical outcomes. In the experiment, subjects have the opportunity to diversify between two simple binary gambles. When subjects lack information about previous outcomes, a vast majority diversify. By contrast, only a minority diversify after learning that one of the gambles has experienced better outcomes than the other in the past. Subjects’ posterior beliefs about winning probabilities predict the propensity to diversify. However, most of the subjects who do not diversify tend to chase the gamble with better historical outcomes, regardless of their beliefs. This behavior is consistent with subjects following a reinforcement heuristic. © 2020 Elsevier B.V.application/pdfhttps://doi.org/10.1016/j.jebo.2020.04.0181672681https://repository.urosario.edu.co/handle/10336/22332engElsevier B.V.211196Journal of Economic Behavior and OrganizationVol. 174Journal of Economic Behavior and Organization, ISSN:1672681, Vol.174,(2020); pp. 196-211https://www.scopus.com/inward/record.uri?eid=2-s2.0-85083900041&doi=10.1016%2fj.jebo.2020.04.018&partnerID=40&md5=a8b19209dd989c036e3feb944032a67eAbierto (Texto Completo)http://purl.org/coar/access_right/c_abf2instname:Universidad del Rosarioreponame:Repositorio Institucional EdocURBeliefsDiversificationReinforcement heuristicUncertaintyWhen diversification clashes with the reinforcement heuristic: An experimental investigationarticleArtículohttp://purl.org/coar/version/c_970fb48d4fbd8a85http://purl.org/coar/resource_type/c_6501Sautua, Santiago Ignacio10336/22332oai:repository.urosario.edu.co:10336/223322022-05-02 07:37:17.343515https://repository.urosario.edu.coRepositorio institucional EdocURedocur@urosario.edu.co
dc.title.spa.fl_str_mv When diversification clashes with the reinforcement heuristic: An experimental investigation
title When diversification clashes with the reinforcement heuristic: An experimental investigation
spellingShingle When diversification clashes with the reinforcement heuristic: An experimental investigation
Beliefs
Diversification
Reinforcement heuristic
Uncertainty
title_short When diversification clashes with the reinforcement heuristic: An experimental investigation
title_full When diversification clashes with the reinforcement heuristic: An experimental investigation
title_fullStr When diversification clashes with the reinforcement heuristic: An experimental investigation
title_full_unstemmed When diversification clashes with the reinforcement heuristic: An experimental investigation
title_sort When diversification clashes with the reinforcement heuristic: An experimental investigation
dc.subject.keyword.spa.fl_str_mv Beliefs
Diversification
Reinforcement heuristic
Uncertainty
topic Beliefs
Diversification
Reinforcement heuristic
Uncertainty
description I experimentally investigate how diversification decisions are affected by information about historical outcomes. In the experiment, subjects have the opportunity to diversify between two simple binary gambles. When subjects lack information about previous outcomes, a vast majority diversify. By contrast, only a minority diversify after learning that one of the gambles has experienced better outcomes than the other in the past. Subjects’ posterior beliefs about winning probabilities predict the propensity to diversify. However, most of the subjects who do not diversify tend to chase the gamble with better historical outcomes, regardless of their beliefs. This behavior is consistent with subjects following a reinforcement heuristic. © 2020 Elsevier B.V.
publishDate 2020
dc.date.accessioned.none.fl_str_mv 2020-05-25T23:56:08Z
dc.date.available.none.fl_str_mv 2020-05-25T23:56:08Z
dc.date.created.spa.fl_str_mv 2020
dc.type.eng.fl_str_mv article
dc.type.coarversion.fl_str_mv http://purl.org/coar/version/c_970fb48d4fbd8a85
dc.type.coar.fl_str_mv http://purl.org/coar/resource_type/c_6501
dc.type.spa.spa.fl_str_mv Artículo
dc.identifier.doi.none.fl_str_mv https://doi.org/10.1016/j.jebo.2020.04.018
dc.identifier.issn.none.fl_str_mv 1672681
dc.identifier.uri.none.fl_str_mv https://repository.urosario.edu.co/handle/10336/22332
url https://doi.org/10.1016/j.jebo.2020.04.018
https://repository.urosario.edu.co/handle/10336/22332
identifier_str_mv 1672681
dc.language.iso.spa.fl_str_mv eng
language eng
dc.relation.citationEndPage.none.fl_str_mv 211
dc.relation.citationStartPage.none.fl_str_mv 196
dc.relation.citationTitle.none.fl_str_mv Journal of Economic Behavior and Organization
dc.relation.citationVolume.none.fl_str_mv Vol. 174
dc.relation.ispartof.spa.fl_str_mv Journal of Economic Behavior and Organization, ISSN:1672681, Vol.174,(2020); pp. 196-211
dc.relation.uri.spa.fl_str_mv https://www.scopus.com/inward/record.uri?eid=2-s2.0-85083900041&doi=10.1016%2fj.jebo.2020.04.018&partnerID=40&md5=a8b19209dd989c036e3feb944032a67e
dc.rights.coar.fl_str_mv http://purl.org/coar/access_right/c_abf2
dc.rights.acceso.spa.fl_str_mv Abierto (Texto Completo)
rights_invalid_str_mv Abierto (Texto Completo)
http://purl.org/coar/access_right/c_abf2
dc.format.mimetype.none.fl_str_mv application/pdf
dc.publisher.spa.fl_str_mv Elsevier B.V.
institution Universidad del Rosario
dc.source.instname.spa.fl_str_mv instname:Universidad del Rosario
dc.source.reponame.spa.fl_str_mv reponame:Repositorio Institucional EdocUR
repository.name.fl_str_mv Repositorio institucional EdocUR
repository.mail.fl_str_mv edocur@urosario.edu.co
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