Advances in prospect theory: cumulative representation of uncertainty
Citations
5,864 citations
4,802 citations
Cites background from "Advances in prospect theory: cumula..."
...…sharply kinked at the reference point and loss averse—steeper for losses than for gains by a factor of about 2–2.5 (Kahneman, Knetsch, & Thaler, 1991; Tversky & Kahneman, 1992); and (d) several studies suggest that the functions in the two domains are fairly well approximated by power functions…...
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...The experimental evidence shows that most people reject a gamble with even chances to win and lose unless the possible win is at least twice the size of the possible loss (see, e.g., Tversky & Kahneman, 1992)....
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...In an article titled “Risk as Feelings,” Loewenstein, Weber, Hsee, and Welch (2001) offered a closely related analysis in which emotional responses, such as the intensity of fear, govern diverse judgments (e.g., ratings of the probability of a disaster)....
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...…gains by a factor of about 2–2.5 (Kahneman, Knetsch, & Thaler, 1991; Tversky & Kahneman, 1992); and (d) several studies suggest that the functions in the two domains are fairly well approximated by power functions with similar exponents, both less than unity (Swalm, 1966; Tversky & Kahneman, 1992)....
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4,462 citations
Cites background from "Advances in prospect theory: cumula..."
...The second was concerned with prospect theory, a model of choice under risk (Kahneman and Tversky, 1979; Tversky and Kahneman, 1992) and with loss aversion in riskless choice (Kahneman et al., 1990, 1991; Tversky and Kahneman, 1991)....
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...…favoring risk aversion; (2) it is convex in the domain of losses, favoring risk seeking; (3) most important, the function is sharply kinked at the reference point, and loss-averse—steeper for losses than for gains by a factor of about 2–2.5 (Kahneman et al., 1991; Tversky and Kahneman, 1992)....
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...The experimental evidence shows that most people will reject a gamble with even chances to win and lose, unless the possible win is at least twice the size of the possible loss (e.g., Tversky and Kahneman, 1992)....
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...A growing literature of eld research and 5 Cumulative prospect theory (Tversky and Kahneman, 1992) does not have this feature. eld experiments documents large and systematic mistakes in some of the most consequential nancial decisions that people make, including choices of investments (Brad M.…...
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...This observation is entirely unremarkable—it does not seem shocking that some attributes of a stimulus are automatically perceived while others must be computed, or that the same attribute is perceived in one display of an object but must be computed in another....
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3,068 citations
References
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"Advances in prospect theory: cumula..." refers background in this paper
...Some time ago we presented a model of choice, called prospect theory, which explained the major violations of expected utility theory in choices between risky prospects with a small number of outcomes (Kahneman and Tversky, 1979; Tversky and Kahneman, 1986)....
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7,005 citations
"Advances in prospect theory: cumula..." refers background in this paper
...Ellsberg (1961) observed that people prefer to bet on an urn containing equal numbers of red and green balls, rather than on an urn that contains red and green balls in unknown proportions....
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