Overview
Scholars interested in decision making under risk have traditionally relied on the standard economic assumptions of expected utility (EU) theory (von Neuman and Morgenstern 1947) to specify the process by which individual actors make decisions. Under the EU framework – which serves as the foundation for deterrence and rational choice theories of crime going back to seminal work by Becker (1968) – an individual actor faced with a risky outcome is expected to select the specific behavioral action that yields the maximized anticipated payoffs. Importantly, the utility of behaviors are weighted by their probabilities of occurrence. The domain of the utility function in this model is absolute benefits and costs, whereby individual decisions of a course of action are dependent solely on the mathematical outcome of the difference between the probability of experiencing the utility of a behavior and the probability of experiencing disutility. Over time, however, researchers in...
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Thomas, K.J., Loughran, T.A. (2014). Rational Choice and Prospect Theory. In: Bruinsma, G., Weisburd, D. (eds) Encyclopedia of Criminology and Criminal Justice. Springer, New York, NY. https://doi.org/10.1007/978-1-4614-5690-2_399
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