Resource title

Yesterday's expectation of tomorrow determines what you do today: the role of reference-dependent utility from expectations

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Resource description

The paper introduces the concept of adjustment utility, that is, referencedependent utility from expectations. It offers an explanation for observed preferences that cannot be explained with existing models, and yields new predictions for individual decision making. The model gives a simple explanation for, e.g., why people are reluctant to change their plans even when these turn out to be unexpectedly costly; people s aversion towards positive but false information, which cannot be explained with previous models; and the increasing acceptance of risks when people get used to them.

Resource author

Astrid Matthey

Resource publisher

Resource publish date

Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/25689

Resource license

Adapt according to the presented license agreement and reference the original author.