Journal article
Loss aversion
Economic Theory, Vol.46(1), pp.127-148
2011
Abstract
Loss aversion is traditionally defined in the context of lotteries over monetary payoffs. This paper extends the notion of loss aversion to a more general setup where outcomes (consequences) may not be measurable in monetary terms and people may have fuzzy preferences over lotteries, i. e., they may choose in a probabilistic manner. The implications of loss aversion are discussed for expected utility theory and rank-dependent utility theory as well as for popular models of probabilistic choice such as the constant error/tremble model and a strong utility model (that includes the Fechner model of random errors and Luce choice model as special cases).
Details
- Title
- Loss aversion
- Authors/Creators
- P.R. Blavatskyy (Author/Creator)
- Publication Details
- Economic Theory, Vol.46(1), pp.127-148
- Publisher
- Springer-Verlag
- Identifiers
- 991005541358207891
- Copyright
- © 2009 Springer-Verlag.
- Murdoch Affiliation
- Murdoch University
- Language
- English
- Resource Type
- Journal article
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- Citation topics
- 6 Social Sciences
- 6.122 Economic Theory
- 6.122.1287 Risk Preferences
- Web Of Science research areas
- Economics
- ESI research areas
- Economics & Business