Probability Weighting and the Persistence of Disagreement among Constituents

This paper is a technical note that reports an interesting risk-related result relevant to the analysis of disagreements among constituents. The problem of interest here is the clash that often arises within a political constituency regarding the decision to act or not act in response to a problematic situation. The analysis presented here shows that the probability weighting function of prospect theory plays a fundamental role in the persistence of disagreements among constituents that involve policy decisions with large potential losses of low likelihood.