Reversals of preference between bids and choices in gambling decisions.

Abstract : Subjects in 3 experiments chose their preferred bet from pairs of bets, and later bid for each bet separately. In each pair, one bet had a higher probability of winning (P bet); the other offered more to win (S bet). Bidding method (selling vs. buying) and payoff method (real-play vs. hourly wage) were varied. Results showed that when the P bet was chosen, the $ bet often received a higher bid. These inconsistencies are incompatible with risky decision models, but can be understood via information-processing considerations. (Author)