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Bernheim and Sprenger (2020) devise and implement a novel test of rank-dependent probability weighting both in general and as formulated in cumulative prospect theory. They reject both hypotheses decisively. Cumulative prospect theory cannot simultaneously account for the rank independence of “equalizing reductions” for three-outcome lotteries, which it construes as indicating linear probability weighting, and the relationship between equalizing reductions and probabilities, which it interprets as indicating highly nonlinear probability weighting. In the current paper, we explore the robustness of the first finding, rank independence of equalizing reductions (and hence of decision weights), with respect to alternative experimental procedures.

This paper investigates the impact of video and text testimonials on willingness to pay (WTP). An experiment is run eliciting WTP for three different ungendered products where participants see a photo of the product and either a male or female video testi- monial, a text testimonial, or no testimonial. We find that the female video testimonial significantly decreases WTP, while the male video testimonial and the text testimonial have approximately no effect. Additionally, the text testimonial leads to a significantly higher retention of factual information presented as compared to the video testimonial treatment. These results support the hypothesis that consumers’ engagement in video testimonials is more focused on the presenter than the product.