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<p>This paper advances classical prospect theory by integrating subjective probabilities into a multi-state, multicriteria framework. The proposed <i>Multicriteria Prospect Theory Approach</i> (MPT-A) demonstrates how prospect theory, renowned for modelling decisions under risk and uncertainty, can serve as a multicriteria decision-making method by adopting an additive structure, leveraging reference points and subjective probabilities for pairwise comparisons. To evaluate the efficacy of this approach, data was used from a field study with 100 students from the University of São Paulo, Ribeirão Preto campus. The evaluation compared MPT-A with ExpTODIM, a multicriteria method rooted in prospect theory, revealing convergence between MPT-A and ExpTODIM. This result underscores the connection of economic and decision-making models. Key findings suggest that economists familiar with classical prospect theory can utilize MPT-A for non-risk-related problems, challenging the notion that economic models lack applicability outside risk scenarios. Simultaneously, ExpTODIM bridges the gap between prescriptive economic approaches and multicriteria decision-making. This study demonstrates that MPT-A and ExpTODIM are complementary rather than competing models, contributing distinct yet compatible tools to both economic and multicriteria analysis repertoires. The integration of MPT-A into economic decision models and the acknowledgment of ExpTODIM within multicriteria analysis reinforce the versatility and applicability of prospect theory across diverse decision contexts.</p>

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Prospect theory and rational decision-making: on the intersection of decision and economic models

  • 期刊论文

  • 发表日期：

    2025年10月29日

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  • Alexandre Bevilacqua Leoneti,
  • Luiz Flávio Autran Monteiro Gomes

摘要

This paper advances classical prospect theory by integrating subjective probabilities into a multi-state, multicriteria framework. The proposed Multicriteria Prospect Theory Approach (MPT-A) demonstrates how prospect theory, renowned for modelling decisions under risk and uncertainty, can serve as a multicriteria decision-making method by adopting an additive structure, leveraging reference points and subjective probabilities for pairwise comparisons. To evaluate the efficacy of this approach, data was used from a field study with 100 students from the University of São Paulo, Ribeirão Preto campus. The evaluation compared MPT-A with ExpTODIM, a multicriteria method rooted in prospect theory, revealing convergence between MPT-A and ExpTODIM. This result underscores the connection of economic and decision-making models. Key findings suggest that economists familiar with classical prospect theory can utilize MPT-A for non-risk-related problems, challenging the notion that economic models lack applicability outside risk scenarios. Simultaneously, ExpTODIM bridges the gap between prescriptive economic approaches and multicriteria decision-making. This study demonstrates that MPT-A and ExpTODIM are complementary rather than competing models, contributing distinct yet compatible tools to both economic and multicriteria analysis repertoires. The integration of MPT-A into economic decision models and the acknowledgment of ExpTODIM within multicriteria analysis reinforce the versatility and applicability of prospect theory across diverse decision contexts.