Life expectancy as a constructed belief: Evidence of a live-to or die-by framing effect

Life expectations are essential inputs for many important personal decisions. We propose that longevity beliefs are responses constructed at the time of judgment, subject to irrelevant task and context factors, and leading to predictable biases. Specifically, we examine whether life expectancy is affected by the framing of expectations questions as either live-to or die-by, as well as by factors that actually affect longevity such as age, gender, and self-reported health. We find that individuals in a live-to frame report significantly higher chances of being alive at ages 55 through 95 than people in a corresponding die-by frame. Estimated mean life expectancies across three studies and 2300 respondents were 7.38 to 9.17 years longer when solicited in a live-to frame. We are additionally able to show how this framing works on a process level and how it affects preference for life annuities. Implications for models of financial decision making are discussed.     

Protective Measures,Personal Experience,and the Affective Psychology of Time

We examined the role of time and affect in intentions to purchase a risk‐protective measure (Studies 1 and 2) and explored participant abilities to factor time into the likelihood judgments that presumably underlie such intentions (Study 3). Participants worried more about losing their possessions and were more likely to purchase a protective measure given a longer term lease than a short‐term lease, but only if their belongings were described in affect‐poor terms. If described instead as being particularly special and affect‐rich, participants neglected time and were about equally likely to purchase a risk‐protective measure for shorter and longer term leases. However, and consistent with prior literature, the cognitive mechanism underlying this time‐neglect‐with‐affect‐richness effect seemed to be the greater use of the affect heuristic in the shorter term than the longer term. Study 2 results demonstrated that prior experience with having been burglarized amplified the interactive effect of time and affect. Greater deliberation did not attenuate this effect as hypothesized whether deliberation was measured through numeracy or manipulated through instructions. The results of Study 3 indicated that few participants are able to calculate correctly the risk numbers necessary to take time into account. Two possible solutions to encourage more purchases of protective measures in the long term are discussed.     

Existence of efficient envy-free allocations of a heterogeneous divisible commodity with nonadditive utilities

This paper studies the existence of Pareto optimal, envy-free allocations of a heterogeneous, divisible commodity for a finite number of individuals. We model the commodity as a measurable space and make no convexity assumptions on the preferences of individuals. We show that if the utility function of each individual is uniformly continuous and strictly monotonic with respect to set inclusion, and if the partition matrix range of the utility functions is closed, a Pareto optimal envy-free partition exists. This result follows from the existence of Pareto optimal envy-free allocations in an extended version of the original allocation problem.