Abstract
This paper provides empirical evidence that probability judgments help explain a reference-dependent preference. It explains using the data for Tokyo Taxi drivers, which includes the respondents about psychological questions. Probability judgments based on a dual process to cognition means judgments and calculations of the probability when they determine something under uncertainty. It weakens the assumption that people have the same rationality. We permit the difference between cognition to rationality and probability judgments. These probability judgments relate to reference points and drivers' personalities and intuition, which influence decision-making and can explain several reference dependences. The difference of cognition to rationality also determines their reference dependence type. It uses Rational Experienced Inventory as the index of cognition to rationality. Frequentist type has different target variables with case type, subjective type, and fortune type. Each probability judgment type has each target as the reference point. Probability judgment types explain the type of cognition to rationality. This explains the endogeneity of reference dependence.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Disclaimer: 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.