Expanded version of regret theory: experimental test

Abstract

The "Regret Theory" [Loomes & Sugden (1987)] predicts that indifference lines fan out from a point to the southwest of the origin of the Marschak-Machina triangle. This fact is a consequence of regret aversion. In this paper we present the results of an experiment which shows that the individuals can change the form of their indifference lines from some triangles to others depending on the central result. Furthermore, we propose an extension to the model of Expanded Uti1it.y depending on difference [Sirvent & Tomás (1992)] which explains these changes by means of the attitude regarding success/failure shown by the individuals.