The impact of statistical learning on violations of the sure-thing principle

Abstract

This paper experimentally tests whether violations of Savage s (1954) sure- thing principle (STP) decrease through statistical learning. Our subjects repeat- edly had to bet on the drawings from an urn with an unknown proportion of di¤erently colored balls. The control group was thereby subjected to learning through mere thought only. In addition, the test group received more and more statistical information over the course of the experiment by observing the color of the ball actually drawn after each bet. We expected that statistical learning would decrease the decision makers ambiguity, thereby implying a stronger de- crease of STP violations in the test than in the control group. However, our data surprisingly shows that learning by mere thought rather than statistical learning leads to a decrease in STP violations.