Prospect Theory

Prospect Theory

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Peter P. Wakker
Cambridge University Press, 22/07/2010
EAN 9780521748681, ISBN10: 0521748682

Paperback, 518 pages, 24.7 x 17.4 x 2.4 cm

Prospect Theory: For Risk and Ambiguity provides the first comprehensive and accessible textbook treatment of the way decisions are made both when we have the statistical probabilities associated with uncertain future events (risk) and when we lack them (ambiguity). The book presents models, primarily prospect theory, that are both tractable and psychologically realistic. A method of presentation is chosen that makes the empirical meaning of each theoretical model completely transparent. Prospect theory has many applications in a wide variety of disciplines. The material in the book has been carefully organized to allow readers to select pathways through the book relevant to their own interests. With numerous exercises and worked examples, the book is ideally suited to the needs of students taking courses in decision theory in economics, mathematics, finance, psychology, management science, health, computer science, Bayesian statistics, and engineering.

'Peter Wakker's new book provides a brilliant account of what has happened in the field of decision theory during the last twenty years. Decision analysts will find here many tools and assessment techniques that will enlarge their usual bag of tricks. One of the virtues of the remarkable text is that it will help to reduce the gap between the models developed by decision theorists and the ones used in practice by most decision analysts. Every serious decision analyst should have a copy of this book at hand.' Denis Bouyssou, CNRS and Université Paris-Dauphine