Behavioural nance has made it possible to discover and, partly, to explain certain types of behaviour by investors which does not conform to the principles of rationality. The most important ones are the disposition eect (Shefrin and Statman, 1985) and the equity premium puzzle (Mehra and Prescott, 1985). By following this approach, consumer psychology has allowed us to study some classical phenomena of preference inconsistency (attraction and compromise) and the eect of dierent methods of eval- uation (for example, joint and separate evaluation; Hsee, Loewenstein, Blount and Bazerman, 2006). In this paper, the idea is to deal with such situations through analysis of multi objective maximization consisting of reference point approaches
A Mathematical Approach for the reference contingent problem
BARILLA, DAVID;CARISTI, Giuseppe;PUGLISI, ALFIO;SAITTA, ERSILIA
2014-01-01
Abstract
Behavioural nance has made it possible to discover and, partly, to explain certain types of behaviour by investors which does not conform to the principles of rationality. The most important ones are the disposition eect (Shefrin and Statman, 1985) and the equity premium puzzle (Mehra and Prescott, 1985). By following this approach, consumer psychology has allowed us to study some classical phenomena of preference inconsistency (attraction and compromise) and the eect of dierent methods of eval- uation (for example, joint and separate evaluation; Hsee, Loewenstein, Blount and Bazerman, 2006). In this paper, the idea is to deal with such situations through analysis of multi objective maximization consisting of reference point approachesPubblicazioni consigliate
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