IDEAS home Printed from
   My bibliography  Save this article

Multiattribute Risky Choice Behavior: The Editing of Complex Prospects


  • John W. Payne

    (Fuqua School of Business, Duke University, Durham, North Carolina 27706)

  • Dan J. Laughhunn

    (Center for International Economic and Business Studies, University of Florida, Gainesville, Florida 32605)

  • Roy Crum

    (Center for International Economic and Business Studies, University of Florida, Gainesville, Florida 32605)


This investigation draws upon concepts from prospect theory (Kahneman and Tversky [Kahneman, D., A. Tversky. 1979. Prospect theory: an analysis of decisions under risk. Econometrica 47 263--291.]) and multiattribute utility theory (Keeney and Raiffa [Keeney, R. L., H. Raiffa. 1976. Decisions with Multiple Objectives: Preferences and Value Tradeoffs. Wiley, New York.]) in an examination of the multiattribute risky choice behavior of 128 managers. The questions of how managers edit multiattribute prospects and how editing relates to various independence assumptions were explored. The major result is that managers appear to violate attribute independence in its general form, and especially in the form of the marginality assumption. The most common form of behavior observed was multiattribute risk aversion for prospects involving only gains and multiattribute risk seeking for prospects involving only losses. This result reinforces the importance of a target, reference point, or aspiration level that has been found in earlier studies of single attribute risky choice. Furthermore, the result casts doubt on such commonly used multiattribute utility functions as the additive, multiplicative, and multilinear forms. The implications of the results for the development of multiattribute risky decision aids are discussed.

Suggested Citation

  • John W. Payne & Dan J. Laughhunn & Roy Crum, 1984. "Multiattribute Risky Choice Behavior: The Editing of Complex Prospects," Management Science, INFORMS, vol. 30(11), pages 1350-1361, November.
  • Handle: RePEc:inm:ormnsc:v:30:y:1984:i:11:p:1350-1361

    Download full text from publisher

    File URL:
    Download Restriction: no


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Kuhberger, Anton, 1998. "The Influence of Framing on Risky Decisions: A Meta-analysis," Organizational Behavior and Human Decision Processes, Elsevier, vol. 75(1), pages 23-55, July.
    2. Edwards, Kimberley D., 1996. "Prospect theory: A literature review," International Review of Financial Analysis, Elsevier, vol. 5(1), pages 19-38.
    3. Beccacece, Francesca & Borgonovo, Emanuele & Buzzard, Greg & Cillo, Alessandra & Zionts, Stanley, 2015. "Elicitation of multiattribute value functions through high dimensional model representations: Monotonicity and interactions," European Journal of Operational Research, Elsevier, vol. 246(2), pages 517-527.
    4. Ravi Dhar & Ning Zhu, 2006. "Up Close and Personal: Investor Sophistication and the Disposition Effect," Management Science, INFORMS, vol. 52(5), pages 726-740, May.
    5. Wilson, Kevin J. & Quigley, John, 2016. "Allocation of tasks for reliability growth using multi-attribute utility," European Journal of Operational Research, Elsevier, vol. 255(1), pages 259-271.
    6. Levy, Haim & Levy, Moshe, 2002. "Experimental test of the prospect theory value function: A stochastic dominance approach," Organizational Behavior and Human Decision Processes, Elsevier, vol. 89(2), pages 1058-1081, November.
    7. Han Bleichrodt & Ulrich Schmidt & Horst Zank, 2009. "Additive Utility in Prospect Theory," Management Science, INFORMS, vol. 55(5), pages 863-873, May.
    8. Kalayci, Erkan & Basdas, Ulkem, 2010. "Does the prospect theory also hold for power traders? Empirical evidence from a Swiss energy company," Review of Financial Economics, Elsevier, vol. 19(1), pages 38-45, January.
    9. Knudsen, Thorbjørn, 2008. "Reference groups and variable risk strategies," Journal of Economic Behavior & Organization, Elsevier, vol. 66(1), pages 22-36, April.


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:inm:ormnsc:v:30:y:1984:i:11:p:1350-1361. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mirko Janc). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.