THE BOOK--Playing The Percentages In Baseball

Thursday, November 16, 2006

Deal Or No Deal

Here is research from the European versions that preceded the American version of the show:
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=636508

Anyone who watches the show sees the obvious pattern of the banker offering 10% to 30% of the expected value, to spur the contestant on.  The fun part is to see the risk aversion point of all the contestants, and how they react to the deal after losing out on the top prize.

If anyone has the research on the higher-stakes American version, please post.

Here’s a Deal Or No Deal Calculator: http://www.rezsoft.org/deal/