O'Donoghue, Ted and Sprenger, Charles (2018) Reference-Dependent Preferences. In: Handbook of Behavioral Economics: Applications and Foundations. Vol.1. Elsevier , Amsterdam, pp. 1-77. ISBN 9780444633743. https://resolver.caltech.edu/CaltechAUTHORS:20200721-134745449
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Abstract
In this chapter, we present theories and applications of reference-dependent preferences. We provide some historical perspective, but also move quickly to the current research frontier, focusing on developments in reference dependence over the last 20 years. We present a number of worked examples to highlight the broad applicability of reference dependence. While our primary focus is gain–loss utility, we also provide a short treatment of probability weighting and its links to reference dependence.
| Item Type: | Book Section | ||||||
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| Additional Information: | © 2018 Elsevier B.V. Available online 17 September 2018. We are grateful to the editors, Stefano DellaVigna, Doug Bernheim, and David Laibson, as well as to Nick Barberis, Alex Rees-Jones, Ori Heffetz, Botond Koszegi, and Keith Ericson for comments and valuable conversations. We also thank participants at the Handbook of Behavioral Economics Workshop, held at Stanford University in August 2016. | ||||||
| Subject Keywords: | Reference-dependent preferences; Loss aversion; Prospect theory; Stochastic reference points; Disappointment aversion; Rank dependent utility | ||||||
| DOI: | 10.1016/bs.hesbe.2018.07.003 | ||||||
| Record Number: | CaltechAUTHORS:20200721-134745449 | ||||||
| Persistent URL: | https://resolver.caltech.edu/CaltechAUTHORS:20200721-134745449 | ||||||
| Official Citation: | Ted O'Donoghue, Charles Sprenger, Chapter 1 - Reference-Dependent Preferences. Editor(s): B. Douglas Bernheim, Stefano DellaVigna, David Laibson, Handbook of Behavioral Economics: Applications and Foundations 1, North-Holland, Volume 1, 2018, Pages 1-77, ISSN 2352-2399, ISBN 9780444633743, https://doi.org/10.1016/bs.hesbe.2018.07.003. (http://www.sciencedirect.com/science/article/pii/S2352239918300034) | ||||||
| Usage Policy: | No commercial reproduction, distribution, display or performance rights in this work are provided. | ||||||
| ID Code: | 104485 | ||||||
| Collection: | CaltechAUTHORS | ||||||
| Deposited By: | Tony Diaz | ||||||
| Deposited On: | 21 Jul 2020 21:22 | ||||||
| Last Modified: | 16 Nov 2021 18:32 |
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