Alexander Sebald (University of Copenhagen) presents his work on "Testing for salience effects in choices under risk" on October 12 from 10am - 12 noon in the VCEE Seminar (SR 1, Oskar-Morgenstern Platz 1).

Abstract:
Recent economic literature acknowledges the fact that our attention is predictively drawn to specific features of our environment. We experimentally investigate a prominent approach to model limited attention in decision making: Salience Theory, proposed by Bordalo et al. (2012b, 2013a). We specifically design a risky choice experimental environment which allows us to control for a large array of alternative theories of behavior. Our experimental results are in line with the behavioral hypothesis of Salience Theory which posits that decision makers base their decisions on decision weights that distort the prospects' actual probabilities in favor of the salient consequences.