How Winning Changes Perception Of The Variables

Senior author of the study Assistant Professor Hiroshi Yamada says “This behavior is surprising because winning probabilities were clearly described to the participants (participants did not have to learn them from experience) and these probabilities were also completely independent of previous outcomes.”

Using their dynamic prospect theory model, the researchers were able to determine that the change in behavior is driven by a change in the perception of probabilities rather than by a change in valuation of rewards.