PROSPECTS THEORY AND INDIVIDUAL STYLE OF ECONOMIC DECISION-MAKING

Abstract

The purpose of the research was to test the prospects theory of Nobel Prize winner in economics D. Kahneman and A. Tversky, which describes the heuristics of economic decision-making, to the adoption of a decision by a concrete person. The method of the study is the Single Case Study, which is the most basic form of case-oriented research. The empirical material was obtained using the Melbourne decision-making questionnaire. The presence of cognitive biases in the decision-making process was determined based on the framing effect. Many methods were used to test the decision-making style of the research participant N and the components of intellectual-personal potential determined. It shows that there are deviations in the process of concrete economic decision making, which are not the result of heuristics, characterized by D. Kahneman and A. Tversky. The decision of the research participant is based on the rational style of this process and the analytical system of reasoning. There is an interaction between cognitive systems 1 and 2 with the evident dominance of the latter. This system blocks cognitive biases and ensures the achievement of results. At the same time, there is an influence from the properties of the intellectual-personal potential of the research participant, such as rationality, intolerance to un-certainty, emotional intelligence. In conclusion, the prospects theory explains the decision-making process in the case study, but the "systematic errors" which D. Kahneman and A. Tversky speak about are not observed. Therefore, there is an opportunity to continue studying the role of individuality in economic behavior. Keywords: behavioral economics, cognitive systems, decision-making style, prospects theory, sin-gle case study.