Evolution Of Non Expected Utility Preferences

Author : Anonim
Publisher : Unknown
Page : 128 pages
File Size : 55,9 Mb
Release : 2005
Category : Electronic
ISBN : OCLC:836929155

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Evolution of Non-expected Utility Preferences by Anonim Pdf

We investigate an extension of Dekel, Ely and Yilankaya's (2004) treatment of the evolution of preference to more general, possibly non-expected utility preferences. Along the lines of their analysis we consider a population of types that is repeatedly and randomly matched to play the mixed extension of any given symmetric two-player normal-form game with complete information. In our setup, a type is a generic best-response correspondence that is assumed to satisfy only standard assumptions. Preferences evolve according to the "success" of the player which is determined by the payoff she receives in the game. As in Dekel, Ely and Yilankaya (2004), the players observe the type of their opponent and a Nash equilibrium according to their best responses is played. We show that Dekel, Ely and Yilankaya's result that stability of an outcome implies efficiency is robust in this more general setup. However, in our model we obtain full equivalence between the two concepts for 2x2 games. We show that efficiency of any strategy also implies the stability of the outcome that it induces. This is in contrast to the former work in which only efficiency of a pure strategy leads to a stable outcome. The result implies the existence of a stable outcome in any 2x2 game. Considering the class of rank-dependent expected utility preferences as example we discuss the model's ability to embed specific types of non-expected utility theories. Moreover, we study implications for well-established games like the prisoner's dilemma. -- Evolution von Präferenzen ; Nicht-Erwartungsnutzentheorie ; Beste-Antwort-Korrespondenz ; Stabilität ; Effizienzstrategie ; Evolution of Preferences ; Non-Expected Utility Theory ; Best-Response Correspondence ; Stability ; Efficient Strategy

Author : Sven von Widekind
Publisher : Springer Science & Business Media
Page : 130 pages
File Size : 45,5 Mb
Release : 2008-01-08
Category : Business & Economics
ISBN : 9783540768456

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Evolution of Non-Expected Utility Preferences by Sven von Widekind Pdf

The theory on the evolution of preferences deals with the endogenous formation of preference relations in strategic situations. It is related to the field of evolutionary game theory. In this book we analyze the role and the influence of general, possibly non-expected utility preferences in such an evolutionary setup. In particular, we demonstrate that preferences which diverge from von Neumann-Morgenstern expected utility may potentially prove to be successful under evolutionary pressures.

Author : Ivan Moscati
Publisher : Cambridge University Press
Page : 99 pages
File Size : 41,6 Mb
Release : 2023-08-31
Category : Philosophy
ISBN : 9781009198257

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The History and Methodology of Expected Utility by Ivan Moscati Pdf

This Element offers an accessible but technically detailed review of expected utility theory (EU). it focuses on the methodological issues that have accompanied its evolution, such as whether the utility function and the other components of EU correspond to actual mental entities.

Author : John Quiggin
Publisher : Springer Science & Business Media
Page : 208 pages
File Size : 43,5 Mb
Release : 2012-12-06
Category : Business & Economics
ISBN : 9789401121828

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Generalized Expected Utility Theory by John Quiggin Pdf

Economic analysis of choice under uncertainty has been dominated by the expected utility (EU) model, yet the EU model has never been without critics. Psychologists accumulated evidence that individual choices under uncertainty were inconsistent with the predictions of the EU model. Applied work in areas such as finance was dominated by the simpler mean-variance analysis. In the 1980s this skepticism was dispelled as a number of generalizations of EU were proposed, most of which were capable of explaining evidence inconsistent with EU, while preserving transitivity and dominance. Generalized expected utility is now a flourishing subfield of economics, with dozens of competing models and considerable literature exploring their theoretical properties and comparing their empirical performance. But the EU model remains the principal tool for the analysis of choice under uncertainty. There is a view that generalized models are too difficult to handle or incapable of generating sharp results. This creates a need to show that the new models can be used in the kinds of economic analysis for which EU has been used, and that they can yield new and interesting results. This book meets this need by describing one of the most popular generalized models -- the rank-dependent expected utility model (RDEU), also known as anticipated utility, EU with rank-dependent preferences, the dual theory of choice under uncertainty, and simply as rank-dependent utility. As the many names indicate, the model has been approached in many ways by many scientists and for this reason, consideration of a single model sheds light on many of the concerns that have motivated the development of generalized utility models. The popularity of the RDEU model rests on its simplicity and tractability. The standard tools of analysis developed for EU theory may be applied to the RDEU model, but since RDEU admits behavior inconsistent with EU, the field of potential applications is widened. As such, the RDEU model is not as much a competitor to EU as an extension based on less restrictive assumptions.

Author : Mark Machina,W. Kip Viscusi
Publisher : Newnes
Page : 897 pages
File Size : 48,6 Mb
Release : 2013-11-14
Category : Business & Economics
ISBN : 9780444536860

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Handbook of the Economics of Risk and Uncertainty by Mark Machina,W. Kip Viscusi Pdf

The need to understand the theories and applications of economic and finance risk has been clear to everyone since the financial crisis, and this collection of original essays proffers broad, high-level explanations of risk and uncertainty. The economics of risk and uncertainty is unlike most branches of economics in spanning from the individual decision-maker to the market (and indeed, social decisions), and ranging from purely theoretical analysis through individual experimentation, empirical analysis, and applied and policy decisions. It also has close and sometimes conflicting relationships with theoretical and applied statistics, and psychology. The aim of this volume is to provide an overview of diverse aspects of this field, ranging from classical and foundational work through current developments. Presents coherent summaries of risk and uncertainty that inform major areas in economics and finance Divides coverage between theoretical, empirical, and experimental findings Makes the economics of risk and uncertainty accessible to scholars in fields outside economics

Author : Ward Edwards
Publisher : Springer Science & Business Media
Page : 304 pages
File Size : 40,6 Mb
Release : 2013-12-01
Category : Business & Economics
ISBN : 9789401129527

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Utility Theories: Measurements and Applications by Ward Edwards Pdf

The Conference on "Utility: Theories, Measurements, and Applications" met at the Inn at Pasatiempo in Santa Cruz, California, from June II to 15, 1989. The all-star cast of attendees are listed as authors in the Table of Contents of this book (see p. V), except for Soo Hong Chew and Amos Tversky. The purpose of the conference, and of National Science Foundation Grant No. SES-8823012 that supported it, was to confront proponents of new generalized theories of utility with leading decision analysts com mitted to the implementation, in practice, of the more traditional theory that these new theories reject. That traditional model is variously iden tified in this book as expected utility or subjectively expected utility maximization (EU or SEU for short) and variously attributed to von Neumann and Morgenstern or Savage. I had feared that the conference might consist of an acrimonious debate between Olympian normative theorists uninterested in what people actually do and behavioral modelers obsessed with the cognitive illusions and uninterested in helping people to make wise decisions. I was entirely wrong. The conferees, in two dramatic straw votes at the open ing session, unanimously endorsed traditional SEU as the appropriate normative model and unanimously agreed that people don't act as that model requires. (These votes had a profound impact on my thinking; detail about them and about that impact is located in Chapter 10.

Author : Daniel Friedman,R. Mark Isaac,Duncan James,Shyam Sunder
Publisher : Routledge
Page : 171 pages
File Size : 45,9 Mb
Release : 2014-02-05
Category : Business & Economics
ISBN : 9781317821236

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Risky Curves by Daniel Friedman,R. Mark Isaac,Duncan James,Shyam Sunder Pdf

For several decades, the orthodox economics approach to understanding choice under risk has been to assume that each individual person maximizes some sort of personal utility function defined over purchasing power. This new volume contests that even the best wisdom from the orthodox theory has not yet been able to do better than supposedly naïve models that use rules of thumb, or that focus on the consumption possibilities and economic constraints facing the individual. The authors assert this by first revisiting the origins of orthodox theory. They then recount decades of failed attempts to obtain meaningful empirical validation or calibration of the theory. Estimated shapes and parameters of the "curves" have varied erratically from domain to domain (e.g., individual choice versus aggregate behavior), from context to context, from one elicitation mechanism to another, and even from the same individual at different time periods, sometimes just minutes apart. This book proposes the return to a simpler sort of scientific theory of risky choice, one that focuses not upon unobservable curves but rather upon the potentially observable opportunities and constraints facing decision makers. It argues that such an opportunities-based model offers superior possibilities for scientific advancement. At the very least, linear utility – in the presence of constraints - is a useful bar for the "curved" alternatives to clear.

Author : Alex C. Michalos
Publisher : Springer
Page : 7347 pages
File Size : 55,9 Mb
Release : 2014-02-12
Category : Social Science
ISBN : 9400707525

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Encyclopedia of Quality of Life and Well-Being Research by Alex C. Michalos Pdf

The aim of this encyclopedia is to provide a comprehensive reference work on scientific and other scholarly research on the quality of life, including health-related quality of life research or also called patient-reported outcomes research. Since the 1960s two overlapping but fairly distinct research communities and traditions have developed concerning ideas about the quality of life, individually and collectively, one with a fairly narrow focus on health-related issues and one with a quite broad focus. In many ways, the central issues of these fields have roots extending to the observations and speculations of ancient philosophers, creating a continuous exploration by diverse explorers in diverse historic and cultural circumstances over several centuries of the qualities of human existence. What we have not had so far is a single, multidimensional reference work connecting the most salient and important contributions to the relevant fields. Entries are organized alphabetically and cover basic concepts, relatively well established facts, lawlike and causal relations, theories, methods, standardized tests, biographic entries on significant figures, organizational profiles, indicators and indexes of qualities of individuals and of communities of diverse sizes, including rural areas, towns, cities, counties, provinces, states, regions, countries and groups of countries.

Author : Ivan Moscati
Publisher : Oxford Studies in History of E
Page : 345 pages
File Size : 50,6 Mb
Release : 2018-11-22
Category : Business & Economics
ISBN : 9780199372768

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Measuring Utility by Ivan Moscati Pdf

Utility is a key concept in the economics of individual decision-making. However, utility is not measurable in a straightforward way. As a result, from the very beginning there has been debates about the meaning of utility as well as how to measure it. This book is an innovative investigation of how these arguments changed over time. Measuring Utility reconstructs economists' ideas and discussions about utility measurement from 1870 to 1985, as well as their attempts to measure utility empirically. The book brings into focus the interplay between the evolution of utility analysis, economists' ideas about utility measurement, and their conception of what measurement in general means. It also explores the relationships between the history of utility measurement in economics, the history of the measurement of sensations in psychology, and the history of measurement theory in general. Finally, the book discusses some methodological problems related to utility measurement, such as the epistemological status of the utility concept and its measures. The first part covers the period 1870-1910, and discusses the issue of utility measurement in the theories of Jevons, Menger, Walras and other early utility theorists. Part II deals with the emergence of the notions of ordinal and cardinal utility during the period 1900-1945, and discusses two early attempts to give an empirical content to the notion of utility. Part III focuses on the 1945-1955 debate on utility measurement that was originated by von Neumann and Morgenstern's expected utility theory (EUT). Part IV reconstructs the experimental attempts to measure the utility of money between 1950 and 1985 within the framework provided by EUT. This historical and epistemological overview provides keen insights into current debates about rational choice theory and behavioral economics in the theory of individual decision-making and the philosophy of economics.

Author : M. Allais,G.M. Hagen
Publisher : Springer Science & Business Media
Page : 706 pages
File Size : 40,6 Mb
Release : 2013-03-14
Category : Social Science
ISBN : 9789401576291

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Expected Utility Hypotheses and the Allais Paradox by M. Allais,G.M. Hagen Pdf

Utility theory or, value theory in general, is certainly the cornerstone of decision theory, game theory, microecon~mics, and all social and political theories which deal with public decisions. Recently the American School of utility, founded by von N eumann Morgenstern, encountered a far-going criticism by the French School of utility represented by its founder Allais. The whole basis of the theory of decisions involving risk has been shaken and put into question. Consequently, basic research in the fundamentals of utility and value theory evolved into a crisis. Like any crisis in basic research, and this one was not an exception, it was very fruitful. One may simply say: Allais versus von Neumann-Morgenstern, or the French School of utility versus the American School, became one of the battlefields of scientific development which proved to be a most creative source of new advances and new developments in all those sciences which are based on evaluation of utilities.

Author : P.C. Fishburn
Publisher : Springer Science & Business Media
Page : 181 pages
File Size : 44,7 Mb
Release : 2013-03-14
Category : Social Science
ISBN : 9789401733298

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The Foundations of Expected Utility by P.C. Fishburn Pdf

This book offers a unified treatment of my research in the foundations of expected utility theory from around 1965 to 1980. While parts are new, the presentation draws heavily on published articles and a few chapters in my 1970 monograph on utility theory. The diverse notations and styles of the sources have of course been reconciled here, and their topics arranged in a logical sequence. The two parts of the book take their respective cues from the von Neumann-Morgenstern axiomatization of preferences between risky options and from Savage's foundational treatment of decision making under uncertainty. Both parts are studies in the axiomatics of preferences for decision situations and in numerical representations for preferences. Proofs of the representation and uniqueness theorems appear at the ends of the chapters so as not to impede the flow of the discussion. A few warnings on notation are in order. The numbers for theorems cited within a chapter have no prefix if they appear in that chapter, but otherwise carry a chapter prefix (Theorem 3.2 is Theorem 2 in Chapter 3). All lower case Greek letters refer to numbers in the closed interval from o to 1. The same symbol in different chapters has essentially the same meaning with one major exception: x, y, ... mean quite different things in different chapters. I am indebted to many people for their help and encouragement.

Author : Wolfgang Hafner,Heinz Zimmermann
Publisher : Springer Science & Business Media
Page : 553 pages
File Size : 47,5 Mb
Release : 2009-11-18
Category : Business & Economics
ISBN : 9783540857112

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Vinzenz Bronzin's Option Pricing Models by Wolfgang Hafner,Heinz Zimmermann Pdf

In 1908, Vinzenz Bronzin, a professor of mathematics at the Accademia di Commercio e Nautica in Trieste, published a booklet in German entitled Theorie der Prämiengeschäfte (Theory of Premium Contracts) which is an old type of option contract. Almost like Bachelier’s now famous dissertation (1900), the work seems to have been forgotten shortly after it was published. However, almost every element of modern option pricing can be found in Bronzin’s book. He derives option prices for an illustrative set of distributions, including the Normal. - This volume includes a reprint of the original German text, a translation, as well as an appreciation of Bronzin's work from various perspectives (economics, history of finance, sociology, economic history) including some details about the professional life and circumstances of the author. The book brings Bronzin's early work to light again and adds an almost forgotten piece of research to the theory of option pricing.

Author : Simon Grant,Atsushi Kajii
Publisher : Unknown
Page : 32 pages
File Size : 51,6 Mb
Release : 1994
Category : Decision-making
ISBN : UCSD:31822018736819

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AUSI Expected Utility by Simon Grant,Atsushi Kajii Pdf

Author : Partha Dasgupta,Karl-Göran Mäler
Publisher : Oxford University Press
Page : 296 pages
File Size : 53,6 Mb
Release : 2000-11-09
Category : Business & Economics
ISBN : 0199240698

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The Environment and Emerging Development Issues: Volume 1 by Partha Dasgupta,Karl-Göran Mäler Pdf

This book presents a set of authoritative studies of the role of environmental resources in the development process, written by some of the most expert professionals in a wide range of associated fields. Contributors address the problems connected with the management of local common property resources, such as soil, water, forests and their products, animals and fisheries, and supply both explanations of existing situations and policies for the future. This volume will be the definitive codification of our understanding of geographically localized environmental problems.

Author : Haim Levy
Publisher : Cambridge University Press
Page : 457 pages
File Size : 53,9 Mb
Release : 2011-10-30
Category : Business & Economics
ISBN : 9781139503020

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The Capital Asset Pricing Model in the 21st Century by Haim Levy Pdf

The Capital Asset Pricing Model (CAPM) and the mean-variance (M-V) rule, which are based on classic expected utility theory, have been heavily criticized theoretically and empirically. The advent of behavioral economics, prospect theory and other psychology-minded approaches in finance challenges the rational investor model from which CAPM and M-V derive. Haim Levy argues that the tension between the classic financial models and behavioral economics approaches is more apparent than real. This book aims to relax the tension between the two paradigms. Specifically, Professor Levy shows that although behavioral economics contradicts aspects of expected utility theory, CAPM and M-V are intact in both expected utility theory and cumulative prospect theory frameworks. There is furthermore no evidence to reject CAPM empirically when ex-ante parameters are employed. Professionals may thus comfortably teach and use CAPM and behavioral economics or cumulative prospect theory as coexisting paradigms.