Prospect/Cumulative Prospect Theory
Cumulative prospect theory and gambling
... in Cumulative Prospect theory; for example, gambling at actuarially unfair odds on the NFL, evens chances at roulette, and odds-on favourites in ...
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Static Portfolio Choice under Cumulative Prospect Theory
... Some research has already been done on optimal investment under Cumulative Prospect Theory (CPT). Most of the previous work takes place in a dynamic set- ting or when no probability distortion ...
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Wagering on more than one outcome in an event in Cumulative Prospect Theory and Rank Dependent Utility
... In this letter we illustrate a seemingly previously not recognised implication of Cumulative Prospect Theory of Tversky and Kahneman (1992) (CPT) and Rank Dependent Utility of Quiggin (1982), (RDU) ...
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Is Cumulative Prospect Theory a Serious Alternative for the Expected Utility Paradigm?
... of Cumulative Prospect Theory evolved from experimental and theoretical literature and more importantly how it can be applied in modeling situations under risk and ...
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Loss aversion and ruinous optimal wagers in cumulative prospect theory
... In Cumulative Prospect Theory (CPT) of Tversky and Kahneman (1992) it is assumed that from a reference point agent’s value function over gains is everywhere risk-averse and the value function over ...
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Stochastic Models for Assets Allocation under the Framework of Prospect and Cumulative Prospect Theory
... the prospect theory of ...utility theory. Moreover, they proposed a new theory — the prospect theory which can explain the behavior of people in decision-making under risk in ...
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Cumulative Prospect Theory and Deferred Annuities
... Due to the fact that no closed form solution for R exists, we solve it numerically. In our analysis, we consider cumulative prospect theory with probability distortion (using π) and without ...
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Experimental Studies of Impacts of Reference Point and Its Change on Individual Value
... proposed cumulative prospect ...using prospect theory reference point and myopic loss aversion to simulate the value changes of ...via cumulative prospect theory, and it ...
9
Too Risk Averse for Prospect Theory?
... Even though we have seen theoretical arguments for why the exponential value function should in principle fit better than the other two functions discussed in Section 3, only empirical evidence can support our arguments. ...
10
Terrorist choice: a stochastic dominance and prospect theory analysis
... (1) cumulative prospect theory (CPT); and (2) stochastic ...risky prospect is accorded the higher prospect ...the cumulative distributions for each ...the cumulative ...
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A Review of Prospect Theory
... the theory of expected ef- ...the prospect theory may have some limitations in the following two aspects: First of all, the value function and weight function need to be further ...of prospect ...
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Behavioural Finance: A Re Examination of Prospect Theory
... alternative theory called the Pros- pect theory. Unlike utility theory, the decision-making process in Prospect the- ory is divided into two phases: the editing phase and the evaluation phase ...
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Randomized strategies and prospect theory in a dynamic context
... This paper derives new results on prospect theory in a dynamic context. Our contribution is to revisit the continuous-time model of Ebert and Strack (2015) under an assumption that agents have access to a ...
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Does Family Involvement Matter in Initial Public Offering Underpricing? Evidence from Saudi Arabia Alrubaishi & Alarifi DOI: 10.32327/IJMESS/8.3.2019.10
... agency theory is rooted in economic rationality where managers seek to maximize their individual utility, rather than having other noneconomic ...Stewardship theory is grounded in psychological and ...
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Inefficient Reallocation, Loss Aversion and Prospect Theory
... Slow search has other implications, besides loss aversion, that relate to prospect theory. In this section we consider how the consumer, given his limited knowledge, will evaluate lotteries. We will assume ...
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Sensation seeking en de prospect theory
... Tversky en Kahneman beschouwen deze framingvormen als het hebben van verschillende perspectieven; mensen kijken immers ook niet altijd op precies dezelfde manier na[r] ...
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Economics and psychology The framing of decisions
... In the Theory of Rational Decision Making the psychological aspects are set aside. This contribution seeks to point out the relevance of psychology into economic decisions. The essay treats the “framing of ...
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On prospects and games: an equilibrium analysis under prospect theory
... The reason to proceed in this way is simple. Our aim is to explore the be- havioural effects of introducing CPT in games, and analyse how this affects NE existence. Therefore, we can use a more manageable function which ...
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INVESTMENT BEHAVIOR & BIASES OF INVESTOR: AN EMPIRICAL RESEARCH AGENDA IN INDIAN PERSPECTIVE
... S. COGNITIVE DISSONANCE: This very influential theory of social psychology was put forward by Leon Festinger (1957). Cognition of persons refers to their ideas, notions, beliefs etc. It is human nature to seek ...
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Prospect Theory and Risk-Seeking Behavior by Troubled Firms
... the prospect theory means when the firms shows above average results then the firm will show the risk averse behavior and those firms which shows the below average results that is troubled firms will show a ...
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