Preference for Randomization and Validity of Random Incentive System Under Ambiguity: An Experiment

The random Incentive System (RIS) is a standard method to incentivize participants in economic experiments. However, recent theoretical studies point out the possibility of its failure under ambiguity. We propose modification RIS, named independent RIS (I-RIS), improve reliability. conducted an experiment evaluate performances and I-RIS direct indirect manners. Whereas nonnegligible fraction are not consistent with reversal-of-order axiom, majority ambiguity averse seeking are. This implies that nonneutral attitudes may report truthful preferences when used. randomization do explain inconsistent choices RIS. In addition, we did find significant differences performance between I-RIS. These results suggest for randomization, which driven by attitudes, cause