[gwern]

> It goes against everything they teach you in Econ 101 -- the expected utility theory is wrong.

I was rather under the impression that prospect theory was descriptive and not normative. Prospect theory ain't gonna save you and your hyperbolic discounting from being money-pumped, and one of the interesting bits of Ainslie's book, IIRC, was discussing how economic incentives and penalties did shift people closer to normatively-correct discounting and away from preference reversals.