Prospect Theory. An Analysis of Decision Making Under Risk

reportActive / Technical Report | Accession Number: ADA045771 | Open PDF

Abstract:

The theoretical basis of decision analysis is utility theory, which describes the principles upon which people wish to base their decisions. This article questions the validity of utility theory and offers an alternative, prospect theory. In addition to providing evidence in support of prospect theory, this paper discusses its implications for the theory and practice of decision analysis. It suggests, for example, ways in which subtle changes in elicitation procedure can have marked effects on peoples expressed values.

Author(s):
Kahneman, Daniel ; Tversky, Amos
Author Organization(s):
DECISIONS AND DESIGNS INC MCLEAN VA
Descriptive Note:
Technical rept.
Supplementary Note:
Prepared in cooperation with Perceptronics, Inc. Eugene, OR. Decision Research Branch, Rept. no. PTR-1042-77-4. Sponsored in part by the DARPA. DOI: 10.21236/ADA045771
Pagination:
0050

Security Markings

DOCUMENT & CONTEXTUAL SUMMARY

Distribution:
Approved For Public Release
Distribution Statement:
Approved For Public Release; Distribution Is Unlimited.

RECORD

Collection: TR
Identifying Numbers
Contract/Grant Number(s):
N00014-76-C-0074, ARPA ORDER-3052
Monitor Series:
ONR
 Subject Terms
Joint Capability Areas:
JCA_5_Command and Control; JCA_5.3_Planning; JCA_4.6_Engineering; JCA_4.6.1_General Engineering; JCA_5.4_Decide; JCA_1_Force Support; JCA_5.3.4_Develop Courses of Action; JCA_5.3.5_Analyze Courses of Action; JCA_1.2_Force Preparation; JCA_1.2.3_Educating; JCA_1.2.5_Lessons Learned; JCA_6_Net Centric; JCA_1.2.7_Experimentation; JCA_8_Building Partnerships
Communities of Interest:
Human Systems
Descriptor(s):
*DECISION MAKING, *DECISION THEORY, *RISK, MATHEMATICAL MODELS, PSYCHOLOGY, THEORY
Field(s)/Group(s):
Psychology
Keyword(s):
PROSPECT THEORY, DECISION ANALYSIS
Report Date:
1977 Apr 01