Richard H Thaler - Misbehaving- The Making of Behavioral Economics (epub)

some modest health benefit but is extremely painful. However, the procedure is administered with a drug
that does not prevent the pain but instead erases all memory of the event. Would you be willing to undertake
this procedure?
† The question that Zeckhauser was interested in is: how does Aidan’s willingness to pay depend on the
number of bullets in the gun? If all the chambers are full, Aidan should pay all he has (and can borrow) to
remove even one bullet. But what if there are only two bullets loaded? What will he pay to remove one of
them? And would it be more or less than what he would pay to remove the last bullet?
‡ Technically, the answers can differ by what economists call an income or wealth effect. You are worse
off in version A than version B because if you do nothing in version B you do not get exposed to the
disease. But this effect cannot explain differences of the magnitudes that I observed, and other surveys in
which I would hypothetically tell people in version A that they had been given (say) $50,000 did not
eliminate the disparity.
§ Rosett did not seem much troubled by this behavior. I subsequently published an article that included
this anecdote, with Rosett described as Mr. R. I sent Rosett a copy of the article when it came out and
received a two-word reply: “Ah fame!”
Of course, the divinity school students might make up for this disparity in the very, very long run.