Estimating the Critical Parameter in Almost Stochastic Dominance from Insurance Deductibles
利用939,690条汽车盗窃保险免赔额选择的真实数据，估计了大多数人可接受的随机占优规则违反程度，为应用几乎随机占优准则提供参考值。
Knowing how small a violation of stochastic dominance rules would be accepted by most individuals is a prerequisite to applying almost stochastic dominance criteria. Unlike previous laboratory-experimental studies, this paper estimates an acceptable violation of stochastic dominance rules with 939,690 real world data observations on a choice of deductibles in automobile theft insurance. We find that, for all policyholders in the sample who optimally chose a low deductible, the upper bound estimate of the acceptable violation ratio is 0.0014, which is close to zero. On the other hand, considering that most decision makers, such as 99% (95%) of the policyholders in the sample, optimally chose the low deductible, the upper bound estimate of the acceptable violation ratio is 0.0405 (0.0732). Our results provide reference values for the acceptable violation ratio for applying almost stochastic dominance rules. This paper was accepted by Manel Baucells, decision analysis.