This paper derives conditions under which the standard decomposition of unconditional expected utility into marginal probabilities and conditional expected utilities generalizes to Cumulative Prospect Theory. The results are relevant for empirical analyses in which marginal probabilities are used as explanatory variables.

We solve a liquidation problem for an agent with preferences consistent with the prospect theory of Kahneman and Tversky (1979). We find that the agent is willing to hold a risky project with a relatively inferior Sharpe ratio if the project is currently making losses, and intends to liquidate it when it breaks even. On the other hand, the agent may liquidate a project with a relatively superio...

We use Bayesian statistical methods to compare the habit persistence asset pricing model of Campbell and Cochrane, the long run risks model of Bansal and Yaron, and the prospect theory model of Barberis, Huang, and Santos. We undertake two types of comparisons, relative and absolute, over two sample periods, 1930–2008 and 1950–2008, using two series, univariate U.S. stock returns and bivariate ...

Neutrinos from the Big Bang are theoretically expected to be the most abundant particles in the Universe after the photons of the Cosmic Microwave Background (CMB). Unlike the relic photons, relic neutrinos have not so far been observed. The Cosmic Neutrino Background (CνB) is the oldest relic from the Big Bang, produced a few seconds after the Bang itself. Due to their impact in cosmology, rel...

This review is occasioned by the fact that the problem of translation, which has simmered on the biological sidelines for the last 40 years, is about to erupt center stage--thanks to the recent spectacular advances in ribosome structure. This most complex, beautiful, and fascinating of cellular mechanisms, the translation apparatus, is also the most important. Translation not only defines gene ...