Arbeitspapier
Foundations of the Rank-Dependent Probability Weighting Function
The psychological basis for rank-dependent probability weighting, and for an inverse-S probability weighting function (PWF) in particular, has often been questioned. I examine the existence and shape of the PWF in a model allowing for optimism/pessimism over probability distributions and for loss averse/gain loving stochastic reference dependence. I give commonly observed shapes of PWF a psychological interpretation. In particular, I establish a deep connection between two of the most established phenomena in decisionmaking: loss aversion and the inverse-S PWF: the former is a pre- condition for the latter.
- Sprache
-
Englisch
- Erschienen in
-
Series: IZA Discussion Papers ; No. 12701
- Klassifikation
-
Wirtschaft
Criteria for Decision-Making under Risk and Uncertainty
Microeconomic Behavior: Underlying Principles
- Thema
-
probability weighting
rank dependent expected utility
loss aversion
reference dependence
optimism
pessimism
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Rablen, Matthew D.
- Ereignis
-
Veröffentlichung
- (wer)
-
Institute of Labor Economics (IZA)
- (wo)
-
Bonn
- (wann)
-
2019
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:45 MEZ
Datenpartner
Dieses Objekt wird bereitgestellt von:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
Objekttyp
- Arbeitspapier
Beteiligte
- Rablen, Matthew D.
- Institute of Labor Economics (IZA)
Entstanden
- 2019
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