The appeal of expected utility theory as a basis for a descriptive model of risky decision making has diminished is a … parametric model of risky decision making. Our results suggest that models which provide for probability transformations are most …-range probability than is proposed by the expected utility model and risk-seeking behavior over quot;long-shotquot; odds is common …

We present a theory of choice among lotteries in which the decision maker's attention is drawn to (precisely defined …) salient payoffs. This leads the decision maker to a context-dependent representation of lotteries in which true probabilities … are replaced by decision weights distorted in favor of salient payoffs. By endogenizing decision weights as a function of …

In line with the fallacy of riskification of uncertainty by which decision makers believe that the effects of … markets, such as natural disasters, terrorist attacks, and financial crises—as a problem of risk management. This is … institutional theory that points to stakeholder and institutional dynamics affecting economic incentives to invest in prevention and …

In this paper, we assess the degree to which four of the most commonly used models of risky decision making can explain … enough to approximate Kahnenman and Tversky's prospect theory and that for certain parametric values will yield the expected … explain the decision-making behavior of the majority of our subjects. Surprisingly, we find that the choice behavior of the …

-Expected Utility theories, we strongly reject Prospect Theory probability weighting, we support disappointment aversion if amended to …

risk aversion if any risk makes a small reduction in wealth more painful (in the sense of an increased reduction in …This paper introduces the concept of standard risk aversion. A von Neumann-Morgenstern utility function has standard … expected utility) also makes any undesirable, independent risk more painful. It is shown that, given monotonicity and concavity …

afflict medical decision making, I apply basic decision theory to suggest reasonable decision criteria with well …This paper discusses how limited ability to assess patient risk of illness and predict treatment response may affect …

reports on direct measures of preference parameters relating to risk tolerance, time preference, and intertemporal … of preference parameters display substantial heterogeneity. The majority of respondents fall into the least risk …-tolerant group, but a substantial minority display higher risk tolerance. The individual measures of intertemporal substitution and …

extremely high risk aversion would achieve a higher expected utility by holding a portfolio of stocks rather than bonds …