Skip to main content
Log in

Harmonic sequence paradox

  • Published:
Economic Theory Aims and scope Submit manuscript

Summary.

Informal evidence suggests that individuals are willing to pay only a finite and, typically, very low price for a specific lottery that converges to an infinite payment with probability one. The established decision theories (expected value, expected utility theory, cumulative prospect theory) cannot satisfactorily explain this low willingness to pay. The presented paradox strengthens the original and the super St. Petersburg paradox.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Similar content being viewed by others

Author information

Authors and Affiliations

Authors

Corresponding author

Correspondence to Pavlo R. Blavatskyy.

Additional information

Received: 27 Spetember 2004, Revised: 15 January 2005,

JEL Classification Numbers:

C91, D81.

I am grateful to Peter Wakker, whose suggestions helped to simplify significantly the exposition of the main idea, and to the participants of a brown-bag seminar at CERGE-EI (June 23, 2004, Prague), notably Dirk Engelmann and Andreas Ortmann, who suggested interesting testable explanations for the paradox.

Rights and permissions

Reprints and permissions

About this article

Cite this article

Blavatskyy, P.R. Harmonic sequence paradox. Economic Theory 28, 221–226 (2006). https://doi.org/10.1007/s00199-005-0606-9

Download citation

  • Issue Date:

  • DOI: https://doi.org/10.1007/s00199-005-0606-9

Keywords and Phrases:

Navigation