Re-examining coherent arbitrariness for the evaluation of common goods and simple lotteries

Abstract

We reexamined the effects of an anchoring manipulation on the valuation of common market goods that was introduced in Ariely, Lowenstein and Prelec (2003) in lab setting. We found much weaker anchoring effects. We performed the same manipulation on the evaluation of binary lotteries, and we found no anchoring effects at all. This suggests limits on the robustness of strong anchoring effects. We thank Drazen Prelec for many helpful conversations, and for sharing the experimental instructions and data from Ariely, Lowenstein and Prelec (2003). We are also grateful to Tore Ellingsen and Oscar Bergman for sharing their instructions and data with us. Zacharias Maniadis would like to thank Nikolaos Georgantzis, Fabio Tufano and Charlie Plott for useful comments. We are also grateful to Kathy Zeiler and for sharing the lottery data from Plott and Zeiler (2005). NSF grants 0646816 and SES-08-51315 provided financial support.

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