Does Economics Need A Psychologist?- Behavioral Models Challenging Expected Utility In A Context Of Gambles

Abstract: This thesis investigates the very concept of behavioral economics in relation to expected utility. A comparison between the standard way to measure utility and alternative manners is executed. More precisely, prospect theory, disappointment theory and regret theory give new and additional psychological perspectives into economics. These aspects embrace behavioral components that influence the final utility. I find this approach useful to reflect human economic behavior where classical economic models fail. To explain, reference dependence, disappointment protection and gambling addiction are analytically addressed. Moreover, I develop the gambling trap to understand persistent and aggressive gambling despite repetitive losses.