On Choosing between Bets

Abstract

Most attempts to account for the way persons choose between bets emphasize the use which is made of information about their basic attributes, i.e. the gains and losses which might be incurred and their respective probabilities. In experimental investigations of betting behaviour this is usually the only information which the subjects are given (e.g. Edwards, 1955; Hurst and Siegel, 1956). Everyday observation suggests, however, that if given the opportunity subjects will also use information about the outcome of bets. In the experiments to be reported, experimental subjects were told what gains had accrued from three bets in the past, the purpose being to see how this information affected their betting.