If utility theory doesn’t work, then what does? One alternative is prospect theory, developed by the author. Kahneman’s prospect theory challenges utility theory by showing that when we make choices, we don’t always act in the most rational way. Imagine these two scenarios for example: In the first scenario, you’re given $1,000 and then must choose […]
I stared at the purse. It was large and heavy with coin, more silver there than I had in gold even if I emptied my vault; far more. Snow was drifting in to melt cold against my cheeks, flecking my shawl. I thought of accepting it in silence, of keeping my head bowed and afraid. […]
