Levy, Haim; Wiener, Zvi - In: Journal of Economics and Business 68 (2013) C, pp. 1-23
Prospect theory (PT), which relies on subjects’ behavior as observed in laboratory experiments, contradicts the behavior predicted by the Expected Utility (EU) paradigm. Having wealth of $100,000 or having wealth of $90,000 and winning $10,000 in a lottery is the same by EU paradigm but not...