Estimating Second Order Probability Beliefs from Subjective Survival Data

Péter Hudomiet, Robert J. Willis

NBER Working Paper No. 18258
Issued in July 2012, Revised in November 2012
NBER Program(s):Economics of Aging, Labor Studies

Based on subjective survival probability questions in the Health and Retirement Study (HRS), we use an econometric model to estimate the determinants of individual-level uncertainty about personal longevity. This model is built around the Modal Response Hypothesis (MRH), a mathematical expression of the idea that survey responses of 0, 50 or 100 percent to probability questions indicate a high level of uncertainty about the relevant probability. We show that subjective survival expectations in 2002 line up very well with realized mortality of the HRS respondents between 2002 and 2010. We show that the MRH model performs better than typically used models in the literature of subjective probabilities. Our model gives more accurate estimates of low probability events and it is able to predict the unusually high fraction of focal 0, 50 and 100 answers observed in many datasets on subjective probabilities. We show that subjects place too much weight on parents' age at death when forming expectations about their own longevity, while other covariates such as demographics, cognition, personality, subjective health and health behavior are underweighted. We also find that less educated people, smokers and women have less certain beliefs; and recent health shocks increase uncertainty about survival, too.

download in pdf format
   (910 K)

email paper

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w18258

Published: Hudomiet, Péter, and Robert Willis. 2013. "Estimating Second Order Probability Beliefs from Subjective Survival Data." Decision Analysis, 10(2): 152-170. PMCID: PMC3882032. DOI. Abstract. citation courtesy of

Users who downloaded this paper also downloaded* these:
Hurd, McFadden, and Gan Subjective Survival Curves and Life Cycle Behavior
Bloom, Canning, Moore, and Song w12688 The Effect of Subjective Survival Probabilities on Retirement and Wealth in the United States
Fosgerau, McFadden, and Bierlaire w17970 Choice Probability Generating Functions
Acemoglu and Wolitzky w18257 Cycles of Distrust: An Economic Model
Gan, Hurd, and McFadden Individual Subjective Survival Curves
NBER Videos

National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email:

Contact Us