Optimal Cognitive Processes for Lotteries
Y. Alarie and
Ecole des Hautes Etudes Commerciales de Montreal- from Ecole des Hautes Etudes Commerciales de Montreal-Chaire de gestion des risques.
The aim of the present paper is to propose a rational model of decision-making for lotteries. The key element of the theory is the use of cognitive processes. The maximization of the degree of confidence associated with each judgment involves different processes. Our contribution explains some major violations of the expected-utility theory for decisions on lotteries.
Keywords: LOTTERY; ECONOMIC MODELS; RISK (search for similar items in EconPapers)
JEL-codes: D80 (search for similar items in EconPapers)
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Working Paper: Optimal Cognitive Processes for Lotteries (2001)
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Persistent link: https://EconPapers.repec.org/RePEc:fth:etcori:01-02
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