publication . Article . Other literature type . Preprint . 2005

Back to the St. Petersburg Paradox

Pavlo R. Blavatskyy;
Open Access
  • Published: 01 Apr 2005 Journal: Management Science, volume 51, pages 677-678 (issn: 0025-1909, eissn: 1526-5501, Copyright policy)
  • Publisher: Institute for Operations Research and the Management Sciences (INFORMS)
  • Country: Switzerland
Abstract
The conventional parameterizations of cumulative prospect theory do not explain the St. Petersburg paradox. To do so, the power coefficient of an individual's utility function must be lower than the power coefficient of an individual's probability weighting function.
Subjects
free text keywords: EUT; Cumulative prospect theory; St. Petersburg paradox; Power utility; Probability ; Weighting., Department of Economics, 330 Economics, Expected utility theory, Cumulative prospect theory, St. Petersburg paradox, Power utility, Probability weighting, Management Science and Operations Research, Strategy and Management, Weighting, Econometrics, Cumulative prospect theory, Mathematical economics, Power coefficient, St. Petersburg paradox, Economics, Power utility, Expected utility hypothesis, jel:C91, jel:D81
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publication . Article . Other literature type . Preprint . 2005

Back to the St. Petersburg Paradox

Pavlo R. Blavatskyy;