In this seminar, Duncan James (Fordham University) presents key findings of the book Risky Curves: On the empirical failure of expected utility, co-authored with Daniel Friedman, Mark Isaac, and Shyam Sunder. The book summarises eight decades of empirical work in expected utility theory and its generalisations. It comes to the sobering conclusion that its “power to predict out-of-sample is in the poor-to-non-existent range.” In addition to revisiting the findings of the book, the seminar also includes a deeper look into new results extending points raised in the book.
