Abstract
Preference reversal is a widely observed behavioural tendency for the preference ordering of a pair of alternatives to depend on the process used to elicit it. The phenomenon appears to be both a robust and a systematic departure from conventional preference theory. Competing theoretical explanations variously interpret it as a violation of procedure invariance (the presumption that preferences should be independent of the method of eliciting them); a failure of transitivity; or a consequence of loss-averse (and reference-dependent) preferences. This article discusses these interpretations, the related evidence, and reflects on some of the broader implications of the phenomenon.
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Starmer, C. (2018). Preference Reversals. In: The New Palgrave Dictionary of Economics. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-349-95189-5_1692
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DOI: https://doi.org/10.1057/978-1-349-95189-5_1692
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