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On the potential for observational equivalence in experiments on risky choice when a power utility function is assumed

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On the potential for observational equivalence in experiments on risky choice when a power utility function is assumed. / Peel, David; Zhang, Jie.

In: Economics Letters, Vol. 116, No. 1, 07.2012, p. 8-10.

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@article{bfeb769d16ff49bca3b6820afde1622c,
title = "On the potential for observational equivalence in experiments on risky choice when a power utility function is assumed",
abstract = "We demonstrate theoretically and illustrate the implications of assuming power utility when the true function is of the expo-power form. Empirical results can appear to be consistent with cumulative prospect theory when they are in fact generated from a Markowitz model.",
keywords = "Cumulative prospect theory",
author = "David Peel and Jie Zhang",
year = "2012",
month = "7",
doi = "10.1016/j.econlet.2011.12.116",
language = "English",
volume = "116",
pages = "8--10",
journal = "Economics Letters",
issn = "0165-1765",
publisher = "Elsevier",
number = "1",

}

RIS

TY - JOUR

T1 - On the potential for observational equivalence in experiments on risky choice when a power utility function is assumed

AU - Peel, David

AU - Zhang, Jie

PY - 2012/7

Y1 - 2012/7

N2 - We demonstrate theoretically and illustrate the implications of assuming power utility when the true function is of the expo-power form. Empirical results can appear to be consistent with cumulative prospect theory when they are in fact generated from a Markowitz model.

AB - We demonstrate theoretically and illustrate the implications of assuming power utility when the true function is of the expo-power form. Empirical results can appear to be consistent with cumulative prospect theory when they are in fact generated from a Markowitz model.

KW - Cumulative prospect theory

U2 - 10.1016/j.econlet.2011.12.116

DO - 10.1016/j.econlet.2011.12.116

M3 - Journal article

VL - 116

SP - 8

EP - 10

JO - Economics Letters

JF - Economics Letters

SN - 0165-1765

IS - 1

ER -