Abstract
ABSTRACTIn an economic laboratory experiment, we study the relationship between prudence and prevention in general decision situations. Previous theoretical research on this relationship posits a negative impact of prudence on the optimal level of prevention. Overall, we find both risk-averse and prudent behaviour among our subjects. Moreover, prudent subjects chose significantly less prevention than nonprudent subjects, confirming the theoretical results of one-period models in the literature. Our findings might have implications for health policy if prudence – rather than irrational decision behaviour, as previously assumed – is responsible for low levels of preventive effort.
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
