Joint Decisions and The Allais Paradox

Placeholder Show Content


This thesis discusses an experiment designed to determine whether the famous Allais paradox is robust to changes in the number of agents per decision. That is, if the Allais gambles are presented to two people who can collaborate, will their preferences tend to be less paradoxical? Or will they systematically violate von-Nuemann Morgenstern (vNM) expected utility theory the same way individuals have been shown to do? Making use of short surveys containing Allais and common-ratio examples over small hypothetical payouts, this study compares the preferences of two types of “agents”: the control agent, a single individual, and the experimental agent, a two-person pair making shared decisions. The results indicate that allowing for collaboration generates a statistically significant reduction in the number of violations of vNM expected utility. Such findings are interpreted as evidence that people in teams tend to gravitate toward an expected utility approach because it facilitates the joint decision-making process.


Type of resource text
Date created May 2013


Author Cortes, Robert
Primary advisor Bhattacharya, Jay
Degree granting institution Stanford University, Department of Economics


Subject Stanford Department of Economics
Subject couples
Subject pairs
Subject collaborations
Subject Allais
Subject decision making
Subject behavior under uncertainty
Subject experimental economics
Genre Thesis

Bibliographic information

Access conditions

Use and reproduction
User agrees that, where applicable, content will not be used to identify or to otherwise infringe the privacy or confidentiality rights of individuals. Content distributed via the Stanford Digital Repository may be subject to additional license and use restrictions applied by the depositor.

Preferred citation

Preferred Citation
Cortes, Robert. (2013). Joint Decisions and The Allais Paradox. Stanford Digital Repository. Available at:


Stanford University, Department of Economics, Honors Theses

View other items in this collection in SearchWorks

Contact information

Also listed in

Loading usage metrics...