Scale Invariance of Principle of Equivalent Utility under Cumulative Prospect Theory

• Authors: J. Chudziak , M. Halicki , S. Wójcik
• Languages of publication: EN

Abstracts

EN

In 1984 A. Reich proved that under Expected Utility Theory, a scale invariance of the Principle of Equivalent Utility just for two particular values of parameters implies its scale invariance. In this paper, we extend this result onto the Principle of Equivalent Utility under Cumulative Prospect Theory.

Keywords

EN

89.65.Gh

Discipline

• 89.65.Gh: Economics; econophysics, financial markets, business and management(for economic issues regarding production and use of renewable energy, see 88.05.Lg)

• Publisher: Institute of Physics, Polish Academy of Sciences
• Journal: Acta Physica Polonica A
• Year: 2015
• Volume: 127
• Issue: 3A
• Pages: A-29-A-32

Dates

published

2015-03

Contributors

author

J. Chudziak

• Faculty of Mathematics and Natural Sciences, University of Rzeszów, Prof. St. Pigonia 1, 35-310 Rzeszów, Poland

author

M. Halicki

• Department of Regional Politics and Food Economy, University of Rzeszów, Ćwiklińskiej 2, 35-601 Rzeszów, Poland

author

S. Wójcik

• Statistical Office in Rzeszów, Jana III Sobieskiego 10, 35-959 Rzeszów, Poland

References

• [1] J. Quiggin, J. Econ. Behav. Organ. 3, 323 (1982)
• [2] U. Segal, Ann. Oper. Res. 19, 359 (1989)
• [3] A. Tversky, D. Kahneman, J. Risk Uncertainty 5, 297 (1992)
• [4] M. Kałuszka, M. Krzeszowiec, Insur. Math. Econ. 50, 159 (2012), doi: 10.1016/j.insmatheco.2011.11.001
• [5] S. Heilpern, Insur. Math. Econ. 33, 67 (2003), doi: 10.1016/S0167-6687(03)00144-6
• [6] A. Reich, ASTIN Bulletin 14, 123 (1984)
• [7] M. Kuczma, An Introduction to the Theory of Functional Equations and Inequalities, Birkhäuser, Berlin 2009

Identifiers

DOI

10.12693/APhysPolA.127.A-29