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Context-Dependent Heterogeneous Preferences: A Comment on Barseghyan and Molinari (2023)

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  • Matias D. Cattaneo
  • Xinwei Ma
  • Yusufcan Masatlioglu

Abstract

Barseghyan and Molinari give sufficient conditions for semi-nonparametric point identification of parameters of interest in a mixture model of decision-making under risk, allowing for unobserved heterogeneity in utility functions and limited consideration. A key assumption in the model is that the heterogeneity of risk preferences is unobservable but context-independent. In this comment, we build on their insights and present identification results in a setting where the risk preferences are allowed to be context-dependent.

Suggested Citation

  • Matias D. Cattaneo & Xinwei Ma & Yusufcan Masatlioglu, 2023. "Context-Dependent Heterogeneous Preferences: A Comment on Barseghyan and Molinari (2023)," Journal of Business & Economic Statistics, Taylor & Francis Journals, vol. 41(4), pages 1030-1034, October.
    • Handle: RePEc:taf:jnlbes:v:41:y:2023:i:4:p:1030-1034
    DOI: 10.1080/07350015.2023.2216740
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    1. Tversky, Amos & Kahneman, Daniel, 1992. "Advances in Prospect Theory: Cumulative Representation of Uncertainty," Journal of Risk and Uncertainty, Springer, vol. 5(4), pages 297-323, October.
    2. Harry Markowitz, 1952. "The Utility of Wealth," Journal of Political Economy, University of Chicago Press, vol. 60(2), pages 151-151.
    3. Levon Barseghyan & Francesca Molinari & Matthew Thirkettle, 2021. "Discrete Choice under Risk with Limited Consideration," American Economic Review, American Economic Association, vol. 111(6), pages 1972-2006, June.
    4. Levon Barseghyan & Francesca Molinari, 2023. "Risk Preference Types, Limited Consideration, and Welfare," Journal of Business & Economic Statistics, Taylor & Francis Journals, vol. 41(4), pages 1011-1029, October.
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