Replicating patterns of prospect theory for decision under risk

Kai Ruggeri (), Sonia Alí, Mari Louise Berge, Giulia Bertoldo, Ludvig D. Bjørndal, Anna Cortijos-Bernabeu, Clair Davison, Emir Demić, Celia Esteban-Serna, Maja Friedemann, Shannon P. Gibson, Hannes Jarke, Ralitsa Karakasheva, Peggah R. Khorrami, Jakob Kveder, Thomas Lind Andersen, Ingvild S. Lofthus, Lucy McGill, Ana E. Nieto, Jacobo Pérez, Sahana K. Quail, Charlotte Rutherford, Felice L. Tavera, Nastja Tomat, Chiara Van Reyn, Bojana Većkalov, Keying Wang, Aleksandra Yosifova, Francesca Papa, Enrico Rubaltelli, Sander van der Linden and Tomas Folke ()
Additional contact information
Kai Ruggeri: Columbia University
Sonia Alí: University of Sussex
Mari Louise Berge: Eötvös Loránd University
Giulia Bertoldo: University of Padova
Ludvig D. Bjørndal: University of Oslo
Anna Cortijos-Bernabeu: University of Barcelona
Clair Davison: University of St Andrews
Emir Demić: University of Belgrade
Celia Esteban-Serna: University College London
Maja Friedemann: University of Oxford
Shannon P. Gibson: Oxford Brookes University
Hannes Jarke: University of Cambridge
Ralitsa Karakasheva: University of Nottingham
Peggah R. Khorrami: Columbia University
Jakob Kveder: University of Ljubljana
Thomas Lind Andersen: Svendborg Municipality
Ingvild S. Lofthus: University of Oslo
Lucy McGill: Trinity College
Ana E. Nieto: University Francisco de Vitoria
Jacobo Pérez: University Francisco de Vitoria
Sahana K. Quail: University of Oxford
Charlotte Rutherford: University of Cambridge
Felice L. Tavera: University of Cologne
Nastja Tomat: University of Ljubljana
Chiara Van Reyn: KU Leuven
Bojana Većkalov: University of Belgrade
Keying Wang: University College London
Aleksandra Yosifova: New Bulgarian University
Francesca Papa: Organisation for Economic Cooperation and Development
Enrico Rubaltelli: University of Padova
Sander van der Linden: University of Cambridge
Tomas Folke: Columbia University

Nature Human Behaviour, 2020, vol. 4, issue 6, 622-633

Abstract: Abstract Prospect theory is among the most influential frameworks in behavioural science, specifically in research on decision-making under risk. Kahneman and Tversky’s 1979 study tested financial choices under risk, concluding that such judgements deviate significantly from the assumptions of expected utility theory, which had remarkable impacts on science, policy and industry. Though substantial evidence supports prospect theory, many presumed canonical theories have drawn scrutiny for recent replication failures. In response, we directly test the original methods in a multinational study (n = 4,098 participants, 19 countries, 13 languages), adjusting only for current and local currencies while requiring all participants to respond to all items. The results replicated for 94% of items, with some attenuation. Twelve of 13 theoretical contrasts replicated, with 100% replication in some countries. Heterogeneity between countries and intra-individual variation highlight meaningful avenues for future theorizing and applications. We conclude that the empirical foundations for prospect theory replicate beyond any reasonable thresholds.

Date: 2020
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DOI: 10.1038/s41562-020-0886-x

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