Huang, Hui; Zhang, Shunming - In: Annals of Economics and Finance 12 (2011) 2, pp. 233-263
the distorted independence axiom to explain the Allais paradox and the common ratio effect. … independence axiom and then to prove the representation theorem of rank-dependent expected utility. Finally, we make direct use of … random variables. Secondly, we utilize the distortion function which reflects decision-makers' beliefs to propose a distorted …