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Open AccessArticle

Emotion and Knowledge in Decision Making under Uncertainty

1
Dipartimento di Scienze Economico-Sociali e Matematico-Statistiche, Università degli Studi di Torino (IT), 10124 Torino, Italy
2
Dipartimento di Economia, Management e Metodi Quantitativi, Università degli Studi di Milano (IT), 20122 Milano, Italy
*
Author to whom correspondence should be addressed.
Games 2019, 10(4), 36; https://doi.org/10.3390/g10040036
Received: 28 June 2019 / Revised: 16 September 2019 / Accepted: 23 September 2019 / Published: 27 September 2019
(This article belongs to the Special Issue The Empirics of Behaviour under Risk and Ambiguity)
This paper presents four incentivised experiments analysing jointly the separate role of immediate integral emotions and knowledge in individual decision making under ambiguity. Reactions to a natural source of uncertainty (i.e., forthcoming real-world election results) were measured using both computed decision weights derived from individual choices and judgmental probabilities determined from the subjects’ estimated likelihood of election outcomes. This study used self-reports to measure emotions aroused by the prospective election victory of a party/coalition of parties, and both self-assessed and actual competence to measure knowledge of politics. This paper found evidence of both preference for ambiguity in the gain domain and of likelihood insensitivity, namely the tendency to overweight unlikely events and to underweight likely events. This paper also shows that a superior knowledge of politics was associated with a preference for ambiguity (i.e., the elevation of the decision weighting function for gains). Both stronger positive emotions and superior knowledge generally have asymmetric effects on likelihood insensitivity (i.e., the curvature of the decision weighting function), each being associated separately with higher overweighting of unlikely election outcomes. View Full-Text
Keywords: preference for ambiguity; ambiguity-generated likelihood insensitivity; emotions; knowledge; competence hypothesis preference for ambiguity; ambiguity-generated likelihood insensitivity; emotions; knowledge; competence hypothesis
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Maffioletti, A.; Santoni, M. Emotion and Knowledge in Decision Making under Uncertainty. Games 2019, 10, 36.

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