We analyze behavior in two basic classes of decision tasks: description-based and experience-based. In particular, we compare the prediction power of a number of decision learning models in both kinds of tasks. Unlike most previous studies, we focus on individual, rather than aggregate,...

This paper tests whether utility is the same for risk and for uncertainty. This test is critical for models that capture ambiguity aversion through a difference in event weighting between risk and uncertainty, like the multiple priors models and prospect theory. We present a new method to...

Deviations from normality in financial return series have led to the development of alternative portfolio selection models. One such model is the downside risk model, whereby the investor maximizes his return given a downside risk constraint. In this paper we empirically observe the...

Risk aversion—but also the higher-order risk preferences of prudence and temperance—are fundamental concepts in the study of economic decision making. We propose a method to jointly measure the intensity of risk aversion, prudence, and temperance. Our theoretical approach is to define risk...

This paper merges the non-expected utility approach (Tversky and Kahneman, J Risk Uncertain 5:297–323, <CitationRef CitationID="CR17">1992</CitationRef> and Quiggin, J Econ Behav Organ 3:323–343, <CitationRef CitationID="CR14">1982</CitationRef>) into Akerlof’s (Quart J Econ 84:488–500, <CitationRef CitationID="CR2">1970</CitationRef>) model of Market for Lemons. We derive the results for different probability...</citationref></citationref></citationref>

This study extends experimental tests of (cumulative) prospect theory (PT) over prospects with more than three outcomes and tests second-order stochastic dominance principles (Levy and Levy, Management Science 48:1334–1349, <CitationRef CitationID="CR44">2002</CitationRef>; Baucells and Heukamp, Management Science 52:1409–1423, <CitationRef CitationID="CR10">2006</CitationRef>)....</citationref></citationref>