POLI 360 Lecture Notes - Lecture 9: Actor Model, Risk Aversion, Expected Utility Hypothesis
2 Oct 2014
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Accidental theory of war: war is an accident. Prospect theory of war (levy: war is a list, war is intentional, presented as an alternative to expected utility theory, rational actor model. A gain a guaranteed (100%) B 50% chance of getting and 50% chance of getting nothing: expected utility. B = 50: example 2 the idea of losses, two choices. If you get , you have a new reference point for comparison at : your caution and risk aversion starts off at a higher level than previously, start making new calculations from here. Risk aversion: the system has a particular distribution of power. States are either satisfied or dissatisfied with this distribution: to determine if a state is satisfied or dissatisfied prospect theory assumes. States are satisfied if states have not assumed any losses: states are not satisfied with what they gain. They will engage in risk averse or risk acceptant behaviour.
