Savage's Axioms Usually Imply Violation of Strict Stochastic Dominance
AbstractL. J. Savage's axioms do not imply strict stochastic dominance. Instead, they usually involve violation of that. Violations occur as soon as the range of the utility function is rich enough, e.g., contains an interval, and the probability measure is, loosely speaking, constructive. An example is given where all of Savage's axioms are satisfied but still strict statewise monotonicity is violated: An agent is willing to exchange an act for another act that with certainty yields a strictly worse outcome. Thus, book can be made against the agent. Stochastic dominance and statewise monotonicity are always satisfied when restricted to acts with finitely many outcomes. Copyright 1993 by The Review of Economic Studies Limited.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Wiley Blackwell in its journal Review of Economic Studies.
Volume (Year): 60 (1993)
Issue (Month): 2 (April)
Contact details of provider:
Web page: http://www.blackwellpublishing.com/journal.asp?ref=0034-6527
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Shalev, Jonathan, 1997.
"Loss aversion in a multi-period model,"
Mathematical Social Sciences,
Elsevier, vol. 33(3), pages 203-226, June.
- Marc Fleurbaey, 2007.
"Assessing Risky Social Situations,"
IDEP Working Papers
0703, Institut d'economie publique (IDEP), Marseille, France, revised Jan 2007.
- FLEURBAEY, Marc, . "Assessing risky social situations," CORE Discussion Papers RP -2289, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Marc Fleurbaey, 2009. "Assessing risky social situations," LSE Research Online Documents on Economics 27006, London School of Economics and Political Science, LSE Library.
- Kopylov, Igor, 2010. "Unbounded probabilistic sophistication," Mathematical Social Sciences, Elsevier, vol. 60(2), pages 113-118, September.
- Kopylov, Igor, 2010. "Simple axioms for countably additive subjective probability," Journal of Mathematical Economics, Elsevier, vol. 46(5), pages 867-876, September.
- Cappelen, Alexander W. & Kariv, Shachar & Sørensen, Erik Ø. & Tungodden, Bertil, 2014. "Is There a Development Gap in Rationality?," Discussion Paper Series in Economics 8/2014, Department of Economics, Norwegian School of Economics.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley-Blackwell Digital Licensing) or (Christopher F. Baum).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.