Friday Article Pick for CFA Candidates and CFA Charterholders: Daniel Kahneman, Amos Tversky (Econometrica, 1979) – Prospect Theory: An Analysis of Decision under Risk

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Following on the article pick from 20 May “Judgment under Uncertainty: Heuristics and Biases (1974)”, “Prospect Theory: An Analysis of Decision under Risk” is the second groundbreaking and most famous academic paper of Kahneman and Tversky. This text is in fact among the most cited academic papers of all time laying core foundations of behavioral economics, having integrated insights from cognitive psychology into economic science.

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