Violations of Cumulative Prospect Theory in Mixed Gambles with Moderate Probabilities

In a classroom choice experiment with mixed gambles and moderate probabilities, we find severe violations of cumulative prospect theory (CPT) and of Markowitz stochastic dominance. Our results shed new light on the exchange between Levy and Levy (2002) and Wakker (2003) in this journal.

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Year of publication:	2006
Authors:	Baltussen, Guido ; Post, Thierry ; Vliet, Pim van
Published in:	Management Science. - Institute for Operations Research and the Management Sciences - INFORMS, ISSN 0025-1909. - Vol. 52.2006, 8, p. 1288-1290
Publisher:	Institute for Operations Research and the Management Sciences - INFORMS
Subject:	cumulative prospect theory \| expected utility \| mixed gambles \| stochastic dominance \| individual decision making under risk

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Extent:	application/pdf
Type of publication:	Article
Other identifiers:	10.1287/mnsc.1050.0544 [DOI]
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10009204093