Explaining the paradoxical effects of poverty on decision making: The Desperation Threshold Model

Abstract excerpt

<p>The impacts of poverty and material scarcity on human decision making appear paradoxical. One set of findings associates poverty with risk aversion, whilst another set associates it with risk taking. We present an idealized general model, the ‘desperation threshold model’ (DTM), that explains how both these accounts can be correct. The DTM assumes a utility function with two features: a threshold or ‘cliff’, a...

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• Cooperative Behavior
• Game Theory
• Models, Biological
• Mutation
• Population Dynamics

Identifiers and source

Literature Corpus work

ef7e2dd6-2d7a-5d34-a898-37abd7325a1d

DOI

10.31234/osf.io/bdvpa_v3