On preference for simplicity and probability weighting

• 成果类型: Article
• 署名作者: Mononen, Lasse
• 署名单位: University of Bielefeld
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/j.jet.2026.106225
• 发表日期: 2026
• 关键词: expected utility; prospect-theory; RISK; complexity; INDEPENDENCE; reduction; DECISION; entropy; PARADOXES; CHOICE

摘要

Complexity aversion in choice under risk is well documented. One of its main behavioral effects is the event-splitting effect. It captures how the value of a lottery changes when one prize is split into two prizes, each with half the original probability. We weaken independence and continuity to accommodate the event-splitting effect. The resulting preferences admit either an expected utility representation with an additive entropy cost of complexity or a power-weighted expected utility representation in which probabilities are weighted by a power function. The model also provides behavioral foundations for logit choice.