Endogenous Prospect Theory
Conference object, Preprint
- Publisher: Verein für Socialpolitik Frankfurt a. M.
prospect theory | diminishing sensitivity | reference point | prospect theory,reference point,diminishing sensitivity,loss aversion | loss aversion | C91 | D81 | D80
In previous models of (cumulative) prospect theory reference-dependence of preferences is imposed beforehand and the location of the reference point is exogenously determined. This paper provides an axiomatization of a new specification of cumulative prospect theory, te...