Advances in Prospect Theory: Cumulative Representation of Uncertainty.

B-Tier
Journal: Journal of Risk and Uncertainty
Year: 1992
Volume: 5
Issue: 4
Pages: 297-323

Authors (2)

Tversky, Amos (not in RePEc) Kahneman, Daniel

Score contribution per author:

1.005 = (α=2.01 / 2 authors) × 1.0x B-tier

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

Abstract

We develop a new version of prospect theory that employs cumulative rather than separable decision weights and extends the theory in several respects. This version, called cumulative prospect theory, applies to uncertain as well as to risky prospects with any number of outcomes, and it allows different weighting functions for gains and for losses. Two principles, diminishing sensitivity and loss aversion, are invoked to explain the characteristic curvature of the value function and the weighting functions. A review of the experimental evidence and the results of a new experiment confirm a distinctive fourfold pattern of risk: risk aversion for gains and risk seeking for losses of high probability; risk seeking for gains and risk aversion for losses of low probability. Copyright 1992 by Kluwer Academic Publishers

Technical Details

RePEc Handle
repec:kap:jrisku:v:5:y:1992:i:4:p:297-323
Journal Field
Theory
Author Count
2
Added to Database
2026-01-25