08 January 2010

As usual, non-rational people make silly decisions

But they apparently still think like I do enough to make it look rational, at least when it comes to valuing experiences over stuff.

There were several comparisons that didn't quite make sense. For example, people do the same story problem but resolve it differently depending on whether you ask them about more income or more vacation time (with the implicit assumption that price levels would magically be stable). People want more relative income to their competitors instead of accepting less relative income but more raw income. In contrast, they want vacation time at a normal, rational rate. This to me is rather strange. If the money has the same hedonistic value in either world, then why wouldn't you just want more of it and not worry about how much everyone else has? If you're somehow worried about that relative value comparison, then why would vacation time have more value than money such that you'd value more vacation time so highly? And then why doesn't it have more value in real life?
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