The Journal of Politics

ARTICLES

On the Evolutionary Origin of Prospect Theory Preferences

Rose McDermotta1, James H. Fowlera2 and Oleg Smirnova3

a1 University of California, Santa Barbara

a2 University of California, San Diego

a3 State University of New York at Stony Brook

Abstract

Prospect theory scholars have identified important human decision-making biases, but they have been conspicuously silent on the question of the origin of these biases. Here we create a model that shows preferences consistent with prospect theory may have an origin in evolutionary psychology. Specifically, we derive a model from risk-sensitive optimal foraging theory to generate an explanation for the origin and function of context-dependent risk aversion and risk-seeking behavior. Although this model suggests that human cognitive architecture evolved to solve particular adaptive problems related to finding sufficient food resources to survive, we argue that this same architecture persists and is utilized in other survival-related decisions that are critical to understanding political outcomes. In particular, we identify important departures from standard results when we incorporate prospect theory into theories of spatial voting and legislator behavior, international bargaining and conflict, and economic development and reform.

(Received April 17 2007)

(Accepted July 16 2007)

Footnotes

Rose McDermott is associate professor of political science, University of California, Santa Barbara, CA 92106. James H. Fowler is associate professor of political science, University of California at San Diego, San Diego, CA 92093. Oleg Smirnov is assistant professor of political science, State University of New York at Stony Brook, Stony Brook, NY 11794.

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