Subjective probability of reward receipt and the magnitude effect in probability discounting

Modeling the effect of reward amount on probability discounting.

The present study with college students examined the effect of amount on the discounting of probabilistic monetary rewards. A hyperboloid function accurately described the discounting of hypothetical rewards ranging in amount from $20 to $10,000,000. The degree of discounting increased continuously with amount of probabilistic reward. This effect of amount was not due to changes in the rate par...

The effect of probability discounting on reward seeking: a three-dimensional perspective

Rats will work for electrical stimulation of the medial forebrain bundle. The rewarding effect arises from the volleys of action potentials fired by the stimulation and subsequent spatio-temporal integration of their post-synpatic impact. The proportion of time allocated to self-stimulation depends on the intensity of the rewarding effect as well as on other key determinants of decision-making,...

Subjective Probability

Subjective Probability ∗

We provide an overview of the idea of subjective probability and its foundational role in decision making and modern management sciences. We highlight the role of Savage’s theory as an organizing methodology to guide and constrain our modeling of choice under uncertainty, rather than a substantive statement subject to refutations by experimental or psychological evidence. ∗Prepared for The Wile...

Subjective Probability and Confidence

This paper shows that a unique and additive subjective belief can be derived from choice behavior that reveals Ellsberg-type ambiguity aversion. This belief is obtained as a component of a utility representation where subjective probabilities are contaminated by an exogenous information set. This representation delivers a parameter that is interpretable as a degree of the decision maker’s confi...