Rethinking Prospect Theory for LLMs: Revealing the Instability of Decision-Making under Epistemic Uncertainty

ArXi:2508.08992v3 Announce Type: replace Prospect Theory (PT) models human decision-making behaviour under uncertainty, among which linguistic uncertainty is commonly adopted in real-world scenarios. Although recent studies have developed some frameworks to test PT parameters for Large Language Models (LLMs), few have considered the fitness of PT itself on LLMs. Moreover, whether PT is robust under linguistic uncertainty perturbations, especially epistemic markers (e.g. "likely"), remains highly under-explored.