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Sharpening Intertemporal Prospect Theory

Author

Listed:
  • Pushpa, Rathie
  • Carlos, Radavelli
  • Sergio, Da Silva

Abstract

Prospect theory [4] of risky choices has been extended to encompass intertemporal choices [6]. Presentation of intertemporal prospect theory suffers from minor mistakes, however [2]. To clarify the theory we restate it and show further mistakes in current presentations ([6], [2]) of value and discount functions.

Suggested Citation

  • Pushpa, Rathie & Carlos, Radavelli & Sergio, Da Silva, 2006. "Sharpening Intertemporal Prospect Theory," MPRA Paper 1849, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:1849
    as

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    File URL: https://mpra.ub.uni-muenchen.de/1849/1/MPRA_paper_1849.pdf
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    References listed on IDEAS

    as
    1. Daniel Kahneman & Amos Tversky, 2013. "Prospect Theory: An Analysis of Decision Under Risk," World Scientific Book Chapters, in: Leonard C MacLean & William T Ziemba (ed.), HANDBOOK OF THE FUNDAMENTALS OF FINANCIAL DECISION MAKING Part I, chapter 6, pages 99-127, World Scientific Publishing Co. Pte. Ltd..
    2. al-Nowaihi, Ali & Dhami, Sanjit, 2006. "A note on the Loewenstein-Prelec theory of intertemporal choice," Mathematical Social Sciences, Elsevier, vol. 52(1), pages 99-108, July.
    3. Colin Camerer & George Loewenstein & Drazen Prelec, 2003. "Neuroeconomics: How neuroscience can inform economics," Levine's Bibliography 506439000000000484, UCLA Department of Economics.
    4. George Loewenstein & Drazen Prelec, 1992. "Anomalies in Intertemporal Choice: Evidence and an Interpretation," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 107(2), pages 573-597.
    5. Paul A. Samuelson, 1937. "A Note on Measurement of Utility," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 4(2), pages 155-161.
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    More about this item

    JEL classification:

    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making

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