Construct · 1 fields · 1 citations
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In behavioural economics a prospect is a gamble, a set of outcomes each with a probability, and prospect theory is Kahneman and Tversky's account of how people actually choose among such gambles in place of expected-utility theory. Its 1979 Prospect theory: An analysis of decision under risk shows that people value outcomes as gains and losses from a reference point rather than as final wealth, weight losses more heavily than equivalent gains, and distort probabilities. The referent here is a probabilistic choice object and the decision model built on it, a wholly different construct from a patch of promising ground or a potential customer.[1]
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