A value function that explains the magnitude and sign effects

C-Tier

Journal: Economics Letters

Year: 2009

Volume: 105

Issue: 3

Pages: 224-229

Authors (2)

al-Nowaihi, Ali (Leicester University) Dhami, Sanjit (not in RePEc)

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

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Abstract

Loewenstein and Prelec (1992) explain the 'magnitude effect' and the 'sign effect', respectively, by using increasing elasticity of the value function and a higher elasticity for losses as compared to gains. We provide a value function with these two properties.

A value function that explains the magnitude and sign effects

Authors (2)

Abstract

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