This paper contributes to the literature on decision making under risk and uncertainty by attaching a weighted probability space to outcome space. Thereby inducing a commutative map of behavior on prospect theory's function space. We endow that space with a psychological metric space, and a time...

We present the first calibration of quantum decision theory (QDT) to an empirical data set. The data comprise 91 choices between two lotteries (two "prospects") presented in 91 random pairs made by 142 subjects offered at two separated times. First, we quantitatively account for the fraction of...

We develop and implement methods for determining whether introducing new securities or relaxing investment constraints improves the investment opportunity set for prospect investors. We formulate a new testing procedure for prospect spanning for two nested portfolio sets based on subsampling and...

We propose a new parametrization of Quantum Decision Theory (QDT), based on Rank Dependent Utility Theory (RDU). Using experimental data made of choices between pairs of lotteries, we compare QDT with "classical" decision theories, RDU and Cumulative Prospect Theory (CPT). At the aggregate...

A number of experiments indicate probabilistic preferences in cases where no one alternative is absolutely optimal. The task of predicting the choice of one of the alternatives among multiple alternatives is then practically important and not trivial. It can occur in situations of choice under...

We investigate whether alternative asset classes should be included in optimal portfolios of the most prominent investor personae in the Behavioral Finance literature, namely, the Cumulative Prospect Theory, the Markowitz and the Loss Averse types of investors. We develop a stochastic spanning...

We introduce a weak rank dependent utility (RDU) model, with one extra parameter compared to the canonical expected utility (EUT) model, which makes many of the same predictions as cumulative prospect theory (CPT). The model extends a set of nonconvex preferences to its maximal inner convex...

Prenatal androgens have organizational effects on brain and endocrine system development, which may have a partial impact on economic decisions. Numerous studies have investigated the relationship between prenatal testosterone and financial risk taking, yet results remain inconclusive. We...

This paper presents a simple Overlapping Generation Model (OLG), aug-mented with Prospect Theory elements in the spirit of al-Nowaihi and Dhami (2007). Themodel tackle several open questions in the analysis of tax evasion and compliance decisions. In particular, the paper presents a new and...

Risk attitudes are known to be sensitive to large stake variations. However, little is known on the sensitivity to moderate variations in stakes. This is important for studies that want to compare risk attitudes between countries or over time. I find that variations of ±20% affect only utility,...