and the potential increments over it are evaluated by subjective expected utility with a risky utility function u. In … contrast to earlier approaches with models that aimed at separating riskless and risky utility, CT does not violate basic … irregularities like the expected utility paradoxes of Allais and Rabin, CT also separates risk attitude in the strong sense from …

This paper deals with utility (or value) function for reference dependent models. A new characterization of S …-shaped utility functions displaying loss aversion is put forward. Then it is used to analyze some standard forms commonly used in the …-shaped utility functions exhibiting loss aversion are presented. -- reference dependence utility ; loss aversion …