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of extremely low probability and treat extremely high probability events as certain. The main alternative decision … theories, rank dependent utility (RDU) and cumulative prospect theory (CP) incorporate (i) but not (ii). By contrast, prospect … by a decision phase that only makes a choice from among the remaining alternatives. However, PT allows for the choice of …
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We provide an axiomatic approach to a belief formation process in an informational environment characterized by limited, heterogenous and differently precise information. For a list of previously observed cases an agent needs to express her belief by assigning probabilities to possible outcomes....
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Since at least de Finetti [7], preference symmetry assumptions have played an important role in models of decision …
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