Y2K Bibliography of Experimental Economics and Social Science
Biases in Individual Decision Making

updated December 29, 1999
Charles A. Holt, cah2k@virginia.edu, suggestions and corrections welcome
(for online and personal use only)

Arkes, Hal, and K. R. Hammond (1987) Judgement and Decision Making: An Interdisciplinary Reader, Cambridge, U. K.: Cambridge University Press. Keywords: experiments, decisions, judgement, biases, psychology.

Arrow, Kenneth, Robert Solow, P. Portney, Edward Leamer, Roy Radner, and H. Schuman (1993) “Report of the NOAA Panel of Contingent Valuation,” Federal Register, 58:10 4602-4614. Keywords: experiments, decisions, contingent valuation, referenda, methodology, incentives, hypothetical bias, policy.

Binswanger, Hans P. (1980) “Attitudes toward Risk: Experimental Measurement in Rural India,” American Journal of Agricultural Economics, 62:3 (August), 395-407. Keywords: experiments, decisions, risk aversion, lottery choice, wealth effects, biases. Abstract: High-stakes gambles were presented to rural farmers in India. Attitudes towards risk are measured and correlated with wealth, education, and luck in previous gambles.

Bjornstad, David, Ronald Cummings, and Laura Taylor (1997) “A Learning Design for Reducing Hypothetical Bias in the Contingent Valuation Method,” Environmental and Resource Economics, 10:3 207-221. Keywords: experiments, decisions, elicitation, contingent valuation, hypothetical bias, learning.

Blackburn, Kenneth***, Glenn W. Harrison, and E. Elisabet Rutström (1994) “Statistical Bias Functions and Informative Hypothetical Surveys,” American Journal of Agricultural Economics, 76:5 (December), 1084-1088. Keywords: experiments, decisions, hypothetical bias.

Camerer, Colin F. (1987) “Do Biases in Probability Judgement Matter in Markets? Experimental Evidence,” American Economic Review, 77:5 (December), 981-997. Keywords: experiments, decisions, probability judgement, biases. Email Contact: camerer@hss.caltech.edu

Camerer, Colin F. (1990) “Do Markets Correct Biases in Probability Judgement? Evidence from Market Experiments,” in Advances in Behavioral Economics, Vol. 2, edited by L. Green and J. Kagel, Greenwich, Conn.: JAI Press, 126-172. Keywords: experiments, decisions, probability judgement, markets, biases. Email Contact: camerer@hss.caltech.edu

Camerer, Colin F. (1995) “Individual Decision Making,” in The Handbook of Experimental Economics, edited by J. H. Kagel and A. E. Roth, Princeton, N.J.: Princeton University Press, 587-703. Keywords: experiments, decisions, biases, psychology, non-expected utility theory. Abstract This paper surveys the literature on experimental tests of non-expected utility theories and on biases in decision making. Email Contact: camerer@hss.caltech.edu

Camerer, Colin F. (1998) “Bounded Rationality in Individual Decision Making,” Experimental Economics, 1:2 163-183. Keywords: experiments, decisions, bounded rationality, utility, psychology, expected utility, non-expected utility, neuro-behavioral economics, biases, probability judgement, choice over time, hedonics. Email Contact: camerer@hss.caltech.edu

Camerer, Colin F., and E. J. Johnson (1991) “The Process-Performance Paradox in Expert Judgement: How Can Experts Know So Much and Predict So Badly?,” in Toward a General Theory of Expertise: Prospects and Limits, edited by K. A. Ericsson and J. Smith, Cambridge: Cambridge University Press, . Keywords: experiments, decisions, forecasts, biases, psychology. Email Contact: camerer@hss.caltech.edu

Camerer, Colin F., George Loewenstein, and Martin Weber (1989) “The Curse of Knowledge in Economic Settings: An Experimental Analysis,” Journal of Political Economy, 97:5 (October), 1232-1254. Keywords: experiments, decisions, information processing, biases, curse of knowledge. Email Contact: camerer@hss.caltech.edu, weber@bank.bwl.uni-mannheim

Charness, Gary, and Ernan Haruvy (1999) “Self-serving Biases in a Simulated Labor Relationship,” Pompeu Fabra University, Discussion Paper. Keywords: experiments, decisions, self-serving bias, biases, psychology, labor. Email Contact: charness@upf.es

Chechile, R. A., and A. D. J. Cooke (1997) “An Experimental Test of a General Class of Utility Models: Evidence for Context Dependency,” Journal of Risk and Uncertainty, 14:1 (January), 75-93. Keywords: experiments, decisions, biases, context dependence.

Cummings, Ronald G., and Laura O. Taylor (1999) “Unbiased Value Estimates for Environmental Goods: A Cheap Talk Design for the Contingent Valuation Method,” American Economic Review, 89:3 (June), ***. Keywords: experiments, decisions, contingent valuation, hypothetical versus real incentives, cheap talk admonitions. Abstract: A warning about the likelihood of overstating valuations in hypothetical elicitation settings is enough to eliminate most of the hypothetical bias in the context considered. Email Contact: prcrgc@langate.gsu.edu

Darjinoff, Karine (1998) “An Experimental Study of Insurance Behavior,” University of Paris 1, Sorbonne, Discussion Paper, presented at the Summer 1998 ESA Meetings. Keywords: experiments, decisions, non-expected utility, risk taking, insurance, context effects, biases. Abstract: The predictions of expected utility and alternative theories are compared in insurance purchase experiments. Some aspects of insurance demand are consistent with expected utility, but attitudes toward risk and risk assessments are context dependent. Email Contact: darjinof@univ-paris1.fr

Davidson, P., and R. Wahlund (1992) “A Note on the Failure to Use Negative Information,” Journal of Economic Psychology, 13:2 (June), 343-353. Keywords: experiments, decisions, information, biases, psychology.

Davis, Larry R., Steven R. Elliott, and Patrick Joyce (1999) “Assurance Information: An Experimental Study,” Michigan Technological University, Keywords: experiments, decisions, information purchase, assurance, accounting, biases. Abstract: Assurance services are informational reports provided by accounting firms hired by either sellers or buyers. The experiment allows prospective buyers to purchase "fairly" priced information about the unknown quality of the good being sold. Email Contact: pjoyce@mtu.edu

Elster, Jon (1985) Sour Grapes: Studies in the Subversion of Rationality, Cambridge, New York and Sydney: Cambridge University Press. Keywords: experiments, decisions, bounded rationality, biases.

Encarnacion, J. (1987) “Preference Paradoxes and Lexicographic Choice,” Journal of Economic Behavior and Organization, 8:2 (June), 231-248. Keywords: experiments, decisions, paradoxes, biases.

Engelmann, Dirk, and Martin Strobel (1998) “The Disappearance of the 'False Consensus Effect' if Representative Information and Monetary Incentives Are Given,” Humboldt University, Discussion Paper, presented at the Summer 1998 ESA Meetings. Keywords: experiments, decisions, false consensus effect, biases, information, incentives. Abstract: The false consensus effect refers to the tendency to bias estimates of another's decision toward one's own decision. This effect is eliminated in an experiment with financial incentives when information is provided about others' decisions; one's own decision receives positive weight (but is weighed less than the observed decisions of others) when the person is asked to predict the unobserved decision of another subject. Email Contact: engelman@wiwi.hu-berlin.de

Fong, Christina, and Kevin A. McCabe (1999) “Is Risky Behavior Malleable?,” Proceedings of the National Academy of Sciences, 96(September), 10927-10932. Keywords: experiments, decisions, risk, biases, illusion of control. Abstract: The "illusion of control" is the assertion in the literature that individuals will value lotteries more if they are involved in the generating the lotteries. This illusion is not observed in the reported experiment; involvement lowers the value of the gamble.

Frey, Bruno S. (1992) Economics as a Science of Human Behavior: Towards a New Social Science Paradigm, Norwell, Mass. and Dordrecht: Kluwer. Keywords: experiments, decisions, biases.

Gigerenzer, G. (1997) “Bounded Rationality: Models of Fast and Frugal Inference,” Schweiz. Z. Volkswirtsch. Statist./Swiss Journal of Economics and Statistics, 133:2 (June), 201-217. Keywords: experiments, decisions, hypothetical payoffs, information processing, biases, bounded rationality.

Gigerenzer, Gerd, and Daniel G. Goldstein (1999) “Reasoning the Fast and Frugal Way: Models of Bounded Rationality,” Psychological Review, forthcoming. Keywords: experiments, decisions, information processing, heuristics, biases.

Green, Leonard, and John H. Kagel, eds. (1990) Advances in Behavioral Economics, Greenwich, Conn.: JAI Press. Keywords: experiments, decisions, markets, biases, behavioral economics.

Grether, David M. (1980) “Bayes' Rule as a Descriptive Model: The Representativeness Heuristic,” Quarterly Journal of Economics, 95(November), 537-557. Keywords: experiments, decisions, Bayes' rule, representativeness, biases, payment incentives, methodology. Email Contact: dmg@doxie.caltech.edu

Herrnstein, Richard J. (1991) “Experiments on Stable Suboptimality in Individual Behavior,” American Economic Review, 81:2 (May), 360. Keywords: experiments, decisions, biases, psychology.

Herrnstein, Richard J., George E. Loewenstein, Drazen Prelec, and William Vaughan Jr. (1993) “Utility Maximization and Melioration: Internalities in Individual Choice,” Journal of Behavioral Decision Making, 6149-185. Keywords: experiments, decisions, marginal analysis, melioration, biases.

Herrnstein, Richard J., and Drazen Prelec (1991) “Melioration: A Theory of Distributed Choice,” Journal of Economic Perspectives, 5:3 (Summer), 137-156. Keywords: experiments, decisions, marginal analysis, melioration, biases.

Hogarth, Robin M. (1988) Judgement and Choice, New York: John Wiley. Keywords: experiments, decisions, biases, psychology.

Hogarth, Robin M., ed. (1990) Insights in Decision Making: A Tribute to Hillel J. Einhorn, Chicago and London: University of Chicago Press. Keywords: experiments, decisions, biases, psychology.

Hogarth, Robin M., and M. W. Reder (1986) “Perspectives from Economics and Psychology: Editor's Comments,” Journal of Business, 59:4 (Part 2, October), S185-207. Keywords: experiments, decisions, biases, psychology, methodology.

Hogarth, Robin M., and Melvin W. Reder, eds. (1987) Rational Choice: The Contrast Between Economics and Psychology, Chicago: Chicago University Press. Keywords: experiments, decisions, methodology, bounded rationality, psychology, biases, anomalies.

Kahneman, Daniel, Jack L. Knetsch, and Richard H. Thaler (1990) “Experimental Tests of the Endowment Effect and the Coase Theorem,” Journal of Political Economy, 98:6 (December), 1325-1348. Keywords: experiments, decisions,
endowment effect, Coase theorem, biases. Email Contact: kahneman@wws.princeton.edu

Kahneman, Daniel, Jack L. Knetsch, and Richard H. Thaler (1991) “The Endowment Effect, Loss Aversion, and Status Quo Bias: Anomalies,” Journal of Economic Perspectives, 5:1 (Winter), 193-206. Keywords: experiments, decisions, biases, anomalies, psychology, endowment effect, loss aversion, status quo bias. Email Contact: kahneman@wws.princeton.edu

Kahneman, Daniel, Paul Slovic, and Amos Tversky, eds. (1982) Judgement Under Uncertainty: Heuristics and Biases, Cambridge: Cambridge University Press. Keywords: experiments, decisions, biases, survey. Email Contact: kahneman@wws.princeton.edu

Kahneman, Daniel, and Amos Tversky (1972) “Subjective Probability: A Judgement of Representativeness,” Cognitive Psychology, 3430-454. Keywords: experiments, decisions, probability judgement, Bayes' rule, representativeness, biases. Email Contact: kahneman@wws.princeton.edu

Kaplan, Todd R., and Bradley J. Ruffle (1999) “The Self-Serving Bias and Beliefs about Rationality,” Ben-Gurion University, Discussion Paper, presented at the Summer 1999 ESA Meeting. Keywords: experiments, decisions, self-serving bias, subject pool effects, rationality. Email Contact: bradley@bgumail.bug.ac.il

Kelman, M., D. E. Fallas, and H. Folger (1998) “Decomposing Hindsight Bias,” Journal of Risk and Uncertainty, 16:3 (July-August), 251-269. Keywords: experiments, decisions, hindsight bias, anomalies.

Kirchner, C. (1994) “New Challenges to the Rationality Assumption: Comment,” Journal of Institutions and Theoretical Economics, 150:1 (March), 37-41. Keywords: experiments, decisions, rationality, bounded rationality, biases.

Knetsch, Jack L. (1989) “The Endowment Effect and Evidence of Non-Reversible Indifference Curves,” American Economic Review, 791277-1284**. Keywords: experiments, decisions, endowment effect, biases.

Knetsch, Jack L. (1995) “Asymmetric Valuation of Gains and Losses and Preference Order Assumptions,” Economic Inquiry, 33:1 (January), 134-141. Keywords: experiments, decisions, biases, reference point, valuation of gains and losses.

Kremer, Tobias, and Markus Nöth (1998) “Overconfidence and Information Cascades: Experimental Evidence,” University of Mannheim, Discussion Paper, presented at the Fall 1998 ESA Meeting. Keywords: experiments, decisions, overconfidence, information cascades, psychology, biases. Email Contact: noeth@bank.BWL.uni-mannheim.de

Laschke, Andreas, Rakesh Sarin, and Martin Weber (1999) “Subjective Probability Updating,” University of Mannheim, Discussion Paper, presented at the Fall 1999 European Regional ESA Meeting. Keywords: experiments, decisions, probability assessment, overconfidence bias. Email Contact: weber@bank.bwl.uni-mannheim

Laury, Susan K., and Melayne Morgan McInnes (1999) “Information and Insurance: An Experimental Investigation,” Georgia State University, Discussion Paper, presented at the Summer 1999 ESA Meeting. Keywords: experiments, decisions, information, insurance, risk pricing, representativeness bias, Bayes' rule. Email Contact: slaury@gsu.edu

List, John A. (1999) “A Field Test of the Cheap Talk Valuation Design,” University of Central Florida, Discussion Paper. Keywords: experiments, field experiments, decisions, contingent valuation, real incentives, hypothetical bias, cheap talk admonitions about hypothetical bias, professional dealer subjects, subject pool comparisons, second price auctions. Abstract: A second price auction for sports cards is used to elicit valuations under three incentive structures: real, hypothetical, and hypothetical-with-warnings about overstating values. The cheap talk warning eliminated hypothetical bias in non-professional subjects, but the bids of card dealers decline sharply with real incentives relative to the cheap-talk (hypothetical incentives) treatment. Email Contact: John.List@bus.ucf.edu

List, John A., and Jason F. Shogren (1998) “The Deadweight Loss of Christmas: Comment,” American Economic Review, 88:5 1350-1355. Keywords: experiments, decisions, elicitation, hypothetical bias, methodology. Email Contact: John.List@bus.ucf.edu

Loewenstein, George, and David Prelec (1991) “Negative Time Preferences,” American Economic Review, 81:2 (May), 347-352. Keywords: experiments, decisions, time preference, biases, psychology.

Loewenstein, George, and David Prelec (1992) “Anomalies in Intertemporal Choice: Evidence and an Interpretation,” Quarterly Journal of Economics, 107:2 (May), 573-597. Keywords: experiments, decisions, time preference, intertemporal choice, anomalies, biases.

Loewenstein, George, and Richard H. Thaler (1989) “Intertemporal Choice,” Journal of Economic Perspectives, 3:4 (Fall), 181-193. Keywords: experiments, decisions, biases, time preference, hyperbolic discounting, psychology.

Loke, W. H. (1989) “The Effects of Framing and Incomplete Information on Judgements,” Journal of Economic Psychology, 10:3 (November), 329-341. Keywords: experiments, decisions, framing, information, biases.

Loomes, Graham, Chris Starmer, and Robert Sugden (1991) “Observing Violations of Transitivity by Experimental Methods,” Econometrica, 59:2 (March), 425-439. Keywords: experiments, decisions, biases, transitivity. Email Contact: gcl1@york.ac.uk

Loomes, Graham, and Robert Sugden (1987) “Testing for Regret and Disappointment in Choice under Uncertainty,” Economic Journal, 97(Supplement), 118-129. Keywords: experiments, decisions, regret theory, biases. Email Contact: gcl1@york.ac.uk

Luce, R. D. (1992) “Where Does Subjective Expected Utility Fail Descriptively?,” Journal of Risk and Uncertainty, 5:1 (February), 5-27. Keywords: experiments, decisions, expected utility theory, biases, anomalies.

Madsen, J. B. (1994) “Tests of Rationality versus an "Over Optimist" Bias,” Journal of Economic Psychology, 15:4 (December), 587-599. Keywords: experiments, decisions, rationality, over optimist bias, biases, psychology.

Mellers, B., R. Weiss, and M. Birnbaum (1992) “Violations of Dominance in Pricing Judgements,” Journal of Risk and Uncertainty, 5:1 (February), 73-90. Keywords: experiments, decisions, valuation, dominance, biases.

Moon, Philip, Kevin Keasey, and Darren Duxbury (1999) “Mental Accounting and Decision Making,” Journal of Economic Behavior and Organization, 38:2 145-153. Keywords: experiments, decisions, mental accounting, biases.

Neil, Helen, Ronald Cummings, Philip Ganderton, Glenn Harrison, and Thomas McGuckin (1994) “Hypothetical Surveys and Real Economic Commitments,” Land Economics, 70:2 . Keywords: experiments, decisions, elicitation, hypothetical bias, methodology.

Offerman, Theo (1998) “Hurting Hurts More than Helping Helps: The Role of the Self-Serving Bias,” University of Amsterdam, Discussion Paper. Keywords: experiments, decisions, self-serving bias. Email Contact: theoo@fee.uva.nl

Offerman, Theo, and Joep Sonnemans (1998) “What's Causing Overreaction? An Experimental Investigation of Recency and the Hot Hand Effect,” University of Amsterdam, Discussion Paper, presented at the Summer 1998 ESA Meeting. Keywords: experiments, decisions, recency bias, hot hand effect, scoring rule, elicitation. Abstract: The experiment is designed to distinguish between "recency bias" (overweighting recent information) and the "hot-hand effect" (searching for autocorrelations in the data). The observed overreactions are more consistent with the hot-hand effect. Email Contact: theoo@fee.uva.nl

Ortona, G., and F. Scacciati (1992) “New Experiments on the Endowment Effect,” Journal of Economic Psychology, 13:2 (June), 277-296. Keywords: experiments, decisions, endowment effect, biases, psychology.

Potters, Jan*, and J. Wit (1999) “Bets and Bids: Favorite-Longshot Bias and Winner's Curse,” Tilburg University,
Discussion Paper. Keywords: experiments, decisions, bets, bids, longshot bias, risk attitudes, winner's curse. Email Contact: j.j.m.potters@kub.nl

Prelec, D. (1998) “The Probability Weighting Function,” Econometrica, 66:3 (May), 497-527. Keywords: experiments, decisions, probability weighting, biases, psychology. Abstract: This paper provides an axiomatic derivation of some properties of probability weighting functions and proposes a flexible two-parameter functional form: w(p) = exp(-b(-ln(p))a ), which has the desired "S-shaped" curvature needed to explain the common ratio effect.

Quattrone, George A., and Amos Tversky (1988) “Contrasting Rational and Psychological Analyses of Political Choice,” American Political Science Review, 82:3 (September), 720-736. Keywords: experiments, decisions, biases, prospect theory, voting, political science, psychology. Abstract: This paper uses the insights of prospect theory and cognitive psychology to explain anomalies in voter and candidate behavior.

Rauchs, A., and Marc Willinger (1996) “Expérimentations sur les choix séquentiels. Application à l'"effet irréversibilité." (Experiments on Sequential Decision-Making: The "Irreversibility Effect." With English Summary),” Revue Ècon,, 47:1 (January), 51-71. Keywords: experiments, decisions, sequential decisions, irreversibility effect, biases.

Ro*theli, Tobias F. (1998) “Pattern Recognition and Procedurally Rational Expectations,” Journal of Economic Behavior and Organization, 35:4 517-533. Keywords: experiments, decisions, forecasting, rational expectations.

Roetheli, Tobias F. (1998) “Acquisition of Costly Information: Experimental Evidence,” University of Bern, Discussion Paper, presented at the Summer 1998 ESA Meeting. Keywords: experiments, decisions, information, information purchase, forecasting. Abstract: Subjects fail to purchase and use information optimally in a forecasting experiment. Many underestimate the value of information. Email Contact: tobias.roetheli@vwi.unibe.ch

Samuelson, William, and Richard Zeckhauser (1988) “Status Quo Bias in Decision Making,” Journal of Risk and Uncertainty, 1:1 (March), 7-59. Keywords: experiments, decisions, status quo bias.

Thaler, Richard H. (1990) “Saving, Fungibility, and Mental Accounts,” Journal of Economic Perspectives, 4:1 (Winter), 193-205. Keywords: experiments, decisions, mental accounts, biases, saving. Email Contact: richard.thaler@gsbsun.uchicago.edu

Thaler, Richard H. (1991) Quasi Rational Economics, New York: Russell Sage Foundation. Keywords: experiments, decisions, bounded rationality, biases. Email Contact: richard.thaler@gsbsun.uchicago.edu

Thaler, Richard H. (1992) The Winners Curse, New York: Free Press. Keywords: experiments, decisions, bargaining, auctions, bounded rationality, biases. Email Contact: richard.thaler@gsbsun.uchicago.edu

Tversky, Amos, and Daniel Kahneman (1974) “Judgment Under Uncertainty: Heuristics and Biases,” Science, 1851124-1131. Keywords: experiments, decisions, biases, heuristics.

Tversky, Amos, and Daniel Kahneman (1986) “Rational Choice and the Framing of Decisions,” Journal of Business, 59:4 (Part 2, October), S251-278. Keywords: experiments, decisions, framing effects, biases.