Skewness as an explanation of gambling in cumulative prospect theory

C-Tier
Journal: Applied Economics
Year: 2009
Volume: 41
Issue: 6
Pages: 685-689

Authors (2)

Score contribution per author:

0.503 = (α=2.01 / 2 authors) × 0.5x C-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

Skewness of return has been suggested as a reason why agents might choose to gamble, ceteris paribus, in cumulative prospect theory (CPT). We investigate the relationship between moments of return in two models where agents choices over uncertain outcomes are determined as in CPT. We illustrate via examples that in CPT theory, as with expected utility theory, propositions that agents have a preference for skewness may be invalid.

Technical Details

RePEc Handle
repec:taf:applec:v:41:y:2009:i:6:p:685-689
Journal Field
General
Author Count
2
Added to Database
2026-01-28