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Asking for frequencies rather than percentages increases the validity of subjective probability measures: Evidence from subjective life expectancy

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  • Comerford, David A.

Abstract

Survey measures of subjective expectations manifest anomalies in how people report percentages. The current research finds that frequency-based measures deliver more valid subjective probabilities of living to a given age than do questions that elicit a percentage chance.

Suggested Citation

  • Comerford, David A., 2019. "Asking for frequencies rather than percentages increases the validity of subjective probability measures: Evidence from subjective life expectancy," Economics Letters, Elsevier, vol. 180(C), pages 33-35.
    • Handle: RePEc:eee:ecolet:v:180:y:2019:i:c:p:33-35
    DOI: 10.1016/j.econlet.2019.04.001
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    References listed on IDEAS

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    1. Wu, Shang & Stevens, Ralph & Thorp, Susan, 2015. "Cohort and target age effects on subjective survival probabilities: Implications for models of the retirement phase," Journal of Economic Dynamics and Control, Elsevier, vol. 55(C), pages 39-56.
    2. John Payne & Namika Sagara & Suzanne Shu & Kirstin Appelt & Eric Johnson, 2013. "Life expectancy as a constructed belief: Evidence of a live-to or die-by framing effect," Journal of Risk and Uncertainty, Springer, vol. 46(1), pages 27-50, February.
    3. Michael D. Hurd, 2009. "Subjective Probabilities in Household Surveys," Annual Review of Economics, Annual Reviews, vol. 1(1), pages 543-564, May.
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    Cited by:

    1. Gizem Koşar & Cormac O'Dea, 2022. "Expectations Data in Structural Microeconomic Models," NBER Working Papers 30094, National Bureau of Economic Research, Inc.
    2. repec:cup:judgdm:v:16:y:2021:i:4:p:1072-1096 is not listed on IDEAS
    3. David A. Comerford, 2021. "Apparent age and gender differences in survival optimism: To what extent are they a bias in the translation of beliefs onto a percentage scale?," Judgment and Decision Making, Society for Judgment and Decision Making, vol. 16(4), pages 1072-1096, July.
    4. David A. Comerford, 2024. "Response Bias in Survey Measures of Expectations: Evidence from the Survey of Consumer Expectations’ Inflation Module," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 56(4), pages 933-953, June.

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    More about this item

    Keywords

    Expectations; Subjective probabilities; Survival expectations; Numeracy;
    All these keywords.

    JEL classification:

    • D15 - Microeconomics - - Household Behavior - - - Intertemporal Household Choice; Life Cycle Models and Saving
    • D84 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Expectations; Speculations
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making

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