We introduce range utility theory for decisions under risk. Two functions are implicated in the representation of preferences: a traditional utility function for wealth---or changes in wealth---and a range distortion function. The latter introduces a local deformation of the utility function on...

Prospect Theory (1979) and its Cumulative version (1992) argue for probability weighting to explain lottery choices. Decision Utility Theory presents an alternative solution, which makes no use of this concept. The new theory distinguishes decision and perception utility, postulates a double...

This paper discusses two approaches for the analysis of multi-outcome lotteries. The first uses Cumulative Prospect Theory. The second is the Relative Utility Function, which strongly resembles the utility function hypothesized by Markowitz (1952). It is shown that the relative utility model...

Prospect Theory (1979) and its Cumulative version (1992) argue for probability weighting to explain lottery choices. Decision Utility Theory presents an alternative solution, which makes no use of this concept. The new theory postulates a double S-shaped decision utility curve similar to the one...

The paper presents a method for lottery valuation using the relative utility function. This function was presented by Kontek (2009) as 'the aspiration function' and resembles the utility curve proposed by Markowitz (1952A). The paper discusses lotteries with discrete and continuous outcome...

This paper introduces the concept of range-dependent utility. Instead of reference dependence which evaluates outcomes relative to some reference point, we postulate dependence on a given lottery (set of lotteries) outcomes range. In this way the decision maker is a fully rational expected...

We introduce range and sign dependent utility, an integrative behavioral model for uncertain cash flows. For gambles played today, the model can be seen as an extension of original prospect theory based on range, rather than rank. For single future payouts, the model agrees with hyperbolic...

We introduce range utility theory, an integrative behavioral model for uncertain cash flows. The model modifies rank dependent utility, by replacing rank principles with range principles, and extends the domain to time. For gambles played in the future, the model generalizes the probability and...