Review on Behavioral Decision-making Theory with Uncertainty
Liu Jing-yin · Systems Engineering · 2015
Sorted by the historical context,existing literature on behavioral decision-making theory can be categorized into three stages.The pioneering stage focuses on the information judgment and selection depending on expected utility theory between 1950 sand 1970s.The non-expected utility theory comes into existence between 1970 sand 1980sas behavioral variables are embedded into rational decision-making models.The subjective expected utility theory with ambiguity has been at the forefront of the modern decision-making theory since late 1980 s.As the behavioral decision-making theory advances considerably,non-expected utility theory and ambiguously subjective expected utility theory are now in widespread use in economics and finance,and hence offering fresh impetus to these fields.