Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/144915
Authors: 
Engel, Christoph
Kirchkamp, Oliver
Year of Publication: 
2016
Series/Report no.: 
Preprints of the Max Planck Institute for Research on Collective Goods 2016/11
Abstract: 
We provide an example for an errors in variables problem which might be often neglected but which is quite common in lab experimental practice: In one task, attitude towards risk is measured, in another task participants behave in a way that can possibly be explained by their risk attitude. How should we deal with inconsistent behaviour in the risk task? Ignoring these observations entails two biases: An errors in variables bias and a selection bias. We argue that inconsistent observations should be exploited to address the errors in variables problem, which can easily be done within a Bayesian framework.
Subjects: 
risk
lab experiment
public good
errors in variables
Bayesian inference
JEL: 
C91
D43
L41
Document Type: 
Working Paper

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