Prospect theory in multiple price list experiments: further insights on behaviour in the loss domain

• Published in: Theory and decision Vol. 94; no. 4; pp. 593 - 636
• Main Authors: Bocquého, Géraldine, Jacob, Julien, Brunette, Marielle
• Format: Journal Article
• Language: English
• Published: New York Springer US 01.05.2023; Springer Nature B.V; Springer Verlag
• Subjects: Behavior; Behavioral/Experimental Economics; Context; Curvature; Domains; Economic Theory/Quantitative Economics/Mathematical Methods; Economics; Economics and Finance; Elicitation; Expected utility; Experiments; Finance; Game Theory; Insurance; Laboratories; Management; Operations Research/Decision Theory; Parameters; Preferences; Probability; Prospect theory; Quantitative Finance; Social and Behav. Sciences; Statistics for Business; Value; Weighting; Weighting functions; Tanaka–Camerer–Nguyen method; Behavioural economics; Reflected behaviour; Risk preferences; Reflection effect; Interval elicitation; Tanaka-Camerer-Nguyen method
• ISSN: 0040-5833; 1573-7187
• DOI: 10.1007/s11238-022-09902-y

In the theoretical description of prospect theory, distinct sets of parameters can control the curvature of the value function and the shape of the probability weighting function. There is one for the gain domain and one for the loss domain. However, in most estimations, behaviour over losses is ass...