Abstract
This paper considers some of the questions raised by the fact that people's behaviour—including their behaviour in experimental environments—has a stochastic component. The nature of this component may be crucial to the interpretation of the patterns of data we observe and the choice of statistical criteria for favouring one hypothesis at the expense of others. However, it is arguable that insufficient consideration has been given to the way(s) in which the stochastic element is modelled. The paper aims to explore some of the issues involved.
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JEL Classification: C12, C73, C91
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Loomes, G. Modelling the Stochastic Component of Behaviour in Experiments: Some Issues for the Interpretation of Data. Exp Econ 8, 301–323 (2005). https://doi.org/10.1007/s10683-005-5372-9
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DOI: https://doi.org/10.1007/s10683-005-5372-9