Harin, Alexander
(2015):
*Is Prelec’s function discontinuous at p = 1? (for the Einhorn Award of SJDM).*

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## Abstract

A possibility of the existence of a discontinuity of Prelec’s (probability weighting) function at the probability p = 1 is discussed. This possibility is supported by the purely mathematical theorems and the “certain–uncertain” inconsistency of the random–lottery incentive experiments. The results of the well-known experiment support it as well.

Item Type: | MPRA Paper |
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Original Title: | Is Prelec’s function discontinuous at p = 1? (for the Einhorn Award of SJDM) |

Language: | English |

Keywords: | Prelec; utility; prospect theory; probability weighting function; Luce; |

Subjects: | C - Mathematical and Quantitative Methods > C0 - General C - Mathematical and Quantitative Methods > C0 - General > C02 - Mathematical Methods C - Mathematical and Quantitative Methods > C1 - Econometric and Statistical Methods and Methodology: General C - Mathematical and Quantitative Methods > C8 - Data Collection and Data Estimation Methodology ; Computer Programs C - Mathematical and Quantitative Methods > C9 - Design of Experiments C - Mathematical and Quantitative Methods > C9 - Design of Experiments > C91 - Laboratory, Individual Behavior C - Mathematical and Quantitative Methods > C9 - Design of Experiments > C93 - Field Experiments D - Microeconomics > D0 - General > D01 - Microeconomic Behavior: Underlying Principles D - Microeconomics > D8 - Information, Knowledge, and Uncertainty D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D81 - Criteria for Decision-Making under Risk and Uncertainty G - Financial Economics > G0 - General > G02 - Behavioral Finance: Underlying Principles G - Financial Economics > G1 - General Financial Markets > G11 - Portfolio Choice ; Investment Decisions |

Item ID: | 64672 |

Depositing User: | Alexander Harin |

Date Deposited: | 28 May 2015 23:16 |

Last Modified: | 28 Sep 2019 16:50 |

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URI: | https://mpra.ub.uni-muenchen.de/id/eprint/64672 |