experiments. Contrary to the traditional view of expected utility theory, the choices can be explained in large part by previous … outcomes experienced during the game. Risk aversion decreases after earlier expectations have been shattered by unfavorable … outcomes or surpassed by favorable outcomes. Our results point to reference-dependent choice theories such as prospect theory …

This paper sets out an ordinal theory of choice under risk that is capable of replicating and extending important … decision problems where attitudes towards risk and correlation play an essential role, we show that characterizing attitudes … towards risk and correlation in terms of an ordinal utility function of decision parameters enables the extension of all …