Work in Progress

Reference dependent preferences naturally lead to violations of structural assumptions like expected utility and exponential discounting, even if behavior conforms with these assumptions for a fixed reference. We introduce a unified framework under which both general rationality (WARP) and domain-specific structural postulates (e.g., Independence for risk preference, Stationarity for time preference) are jointly relaxed using a systematic reference dependence approach. This allows us to study risk, time, and social preferences collectively, where behavioral departures from WARP and structural postulates are explained by a common source—changing preferences due to reference dependence. In our setting, reference points are given by a linear order that captures the relevance of each alternative in affecting preferences. In turn, they determine the domain-specific preference parameters for the underlying choice problem (e.g., utility functions for risk, discount factors for time).

  • Avoidable Risk: An Experiment on Context-Dependent Risk Aversion with Silvio Ravaioli

  • Consideration Set and WARP Violations in Sequence of Real Choices