Replicating patterns of prospect theory for decision under risk

• Published in: Nature human behaviour Vol. 4; no. 6; pp. 622 - 633
• Main Authors: Ruggeri, Kai, Alí, Sonia, Berge, Mari Louise, Bertoldo, Giulia, Bjørndal, Ludvig D., Cortijos-Bernabeu, Anna, Davison, Clair, Demić, Emir, Esteban-Serna, Celia, Friedemann, Maja, Gibson, Shannon P., Jarke, Hannes, Karakasheva, Ralitsa, Khorrami, Peggah R., Kveder, Jakob, Andersen, Thomas Lind, Lofthus, Ingvild S., McGill, Lucy, Nieto, Ana E., Pérez, Jacobo, Quail, Sahana K., Rutherford, Charlotte, Tavera, Felice L., Tomat, Nastja, Reyn, Chiara Van, Većkalov, Bojana, Wang, Keying, Yosifova, Aleksandra, Papa, Francesca, Rubaltelli, Enrico, Linden, Sander van der, Folke, Tomas
• Format: Journal Article
• Language: English
• Published: London Nature Publishing Group UK 01.06.2020; Nature Publishing Group
• Subjects: 4014/159; 4014/477; 4014/477/2811; Adolescent; Adult; Aged; Aged, 80 and over; Behavioral Sciences; Biomedical and Life Sciences; Cross-Cultural Comparison; Decision Making; Exceptions; Expected utility; Experimental Psychology; Female; Humans; Individual differences; Kahneman, Daniel (1934-2024); Life Sciences; Male; Microeconomics; Middle Aged; Neurosciences; Personality and Social Psychology; Prospect theory; Psychological Theory; Reproducibility of Results; Risk; Risk-Taking; Scrutiny; Theory; Thresholds; Utility theory; Young Adult
• ISSN: 2397-3374; 2397-3374
• DOI: 10.1038/s41562-020-0886-x

Prospect theory is among the most influential frameworks in behavioural science, specifically in research on decision-making under risk. Kahneman and Tversky’s 1979 study tested financial choices under risk, concluding that such judgements deviate significantly from the assumptions of expected utility theory, which had remarkable impacts on science, policy and industry. Though substantial evidence supports prospect theory, many presumed canonical theories have drawn scrutiny for recent replication failures. In response, we directly test the original methods in a multinational study ( n  = 4,098 participants, 19 countries, 13 languages), adjusting only for current and local currencies while requiring all participants to respond to all items. The results replicated for 94% of items, with some attenuation. Twelve of 13 theoretical contrasts replicated, with 100% replication in some countries. Heterogeneity between countries and intra-individual variation highlight meaningful avenues for future theorizing and applications. We conclude that the empirical foundations for prospect theory replicate beyond any reasonable thresholds. In a sample of over 4,000 participants from 19 countries, the core patterns from a highly influential study on behaviour and decision-making broadly replicate, with only minor exceptions and somewhat smaller effect sizes.