From expected utility theory to prospect theory: tracking down the experimental path after forty years

Sławomir Kalinowski ()

Operations Research and Decisions, 2020, vol. 30, issue 4, 39-56

Abstract: The expected utility theory axioms have been studied experimentally. Three of the experiments are a repetition of an earlier test in slightly changed circumstances, while the other two are original. The participants were incentivised with rewards, which did not happen in the replicated tests. The results confirmed the degeneration of the expected utility theory as a scientific research program. The evidence that resulted from the tests supported the hypothesis on the cumulative prospect theory predicting facts not forecasted by the EUT.

Keywords: economic decisions under risk; expected utility theory; cumulative prospect theory; experimental (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:wut:journl:v:30:y:2020:i:4:p:39-56:id:1555

DOI: 10.37190/ord200403

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