A BELIEF-BASED ACCOUNT OF DECISION UNDER UNCERTAINTY

We develop a belief-based account of decision under uncertainty. This model predicts decisions under uncertainty from (i)judgments of probab ility, which are assumed to satisfy support theory; and (ii) decisions under risk, which are assumed to satisfy prospect theory. In two expe riments, subjects evaluated uncertain prospects and assessed the proba bility of the respective events. Study I involved the 1995 professiona l basketball playoffs; Study 2 involved the movement of economic indic ators in a simulated economy. The results of both studies are consiste nt with the belief-based account, but violate the partition inequality implied by the classical theory of decision under uncertainty.