Graham Loomes

Testing Different Stochastic Specificationsof Risky Choice

The Harless-Camerer (HC), Hey-Orme (HO), and random preference (RP) models of stochastic variation in choice under uncertainty are compared. Implications of these models, including some that are independent of the deterministic theory with which they are combined, are tested in an experiment in which participants respond to decision problems twice. The HC model generally performs poorly; the HO model predicts more violations of dominance than are observed; while the RP model fails to account for those few violations which do occur. Additional regularities are observed which are inconsistent with all three models when combined with expected utility theory. Copyright 1998 by The London School of Economics and Political Science

Probabilities vs Money: A Test of Some Fundamental Assumptions about Rational Decision Making

This paper describes an experiment where respondents were asked to tackle two decision tasks which were very similar in structure but which differed in that one problem involved direct money payoffs while the other involved payoffs in the form of probabilities of winning a given sum of money. According to most decision models, most risk averse individuals might be expected to behave quite differently under the two conditions. But the behavior actually observed does not accord with this expectation. The paper discusses possible reasons for this and the potential implications of such findings.

Why Did Two Theoretically Equivalent Methods Produce Two Very Different Values

In 1991 a team from the Universities of Newcastle and York conducted a study that set out to estimate the value of preventing non-fatal road traffic injuries. The research was commissioned by the Department of Transport (DoT) and the Transport Research Laboratory (TRL) to put the valuation of preventing such injuries on the same willingness-to-pay footing as the figure used to value the prevention of road fatalities.

Valuing Health and Safety: Some Economic and Psychological Issues

When making decisions about the allocation of scarce social resources, how should we weigh the benefits (or disbenefits) of changes in the health or safety of members of the population? The conventional (economic) wisdom is that the preferences of the affected population should be elicited — in the form of their willingness to trade off wealth for health/safety — and should then be incorporated into some overall cost-benefit analysis.

Preference-Based Values of Safety for Public Transport Modes

Following the 1987 King’s Cross fire in which 31 people died, London Underground Limited (LUL) 1 instituted an extensive programme of research aimed at developing its procedures for the appraisal of proposed safety projects. As part of that programme, LUL commissioned the authors to consider the question of the monetary valuation of Underground safety.

Évaluation des risques environnementaux pour la santé des enfants

La reduction des risques environnementaux a-t-elle plus de valeur lorsqu’il s’agit d’enfants que lorsqu’il s’agit d’adultes ? Et si oui, quelles sont les consequences pour l’action des pouvoirs publics ? Produit final du projet sur l’evaluation des impacts sur la sante lies a l’environnement (VERHI), ce rapport expose les resultats de nouveaux travaux de recherche consacres a cette importante question de politique de l’environnement.nLes auteurs presentent des estimations de la VVS (valeur d’une vie statistique) des enfants et des adultes qui sont produites sur la base de nouvelles approches methodologiques de l’evaluation de la sante des enfants. Ces travaux se distinguent par la dimension internationale des enquetes (realisees en Italie, en Republique tcheque et au Royaume-Uni) et par un travail approfondi de mise au point.nLes resultats du projet sont multiples : deux nouveaux instruments d’enquete reposant sur des approches methodologiques differentes ; de nouvelles estimations de la VVS des adultes et des enfants ; une analyse des effets du contexte et d’autres facteurs sur les preferences en matiere de risques ; des moyens originaux de presenter les risques, dont divers supports visuels ; et des enseignements qui permettent de degager des pistes interessantes en vue de nouvelles etudes.