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Confidence in preferences

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  • Hill, Brian

Abstract

Indeterminate preferences have long been a tricky subject for choice theory. One reason for which preferences may be less than fully determinate is the lack of confidence in one’s preferences. In this paper, a representation of confidence in preferences is proposed. It is used to develop an account of the role which confidence which rests on the following intuition: the more important the decision to be taken, the more confidence is required in the preferences needed to take it. An axiomatisation of this choice rule is proposed. This theory provides a natural account of when an agent should defer a decision; namely, when the importance of the decision exceeds his confidence in the relevant preferences. Possible applications of the notion of confidence in preferences to social choice are briefly explored.

Suggested Citation

  • Hill, Brian, 2009. "Confidence in preferences," HEC Research Papers Series 919, HEC Paris.
    • Handle: RePEc:ebg:heccah:0919
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    References listed on IDEAS

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    1. Amartya Sen, 1997. "Maximization and the Act of Choice," Econometrica, Econometric Society, vol. 65(4), pages 745-780, July.
    2. Brian Hill, 2012. "Confidence in preferences," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 39(2), pages 273-302, July.
    3. Kreps, David M, 1979. "A Representation Theorem for "Preference for Flexibility"," Econometrica, Econometric Society, vol. 47(3), pages 565-577, May.
    4. Sen, Amartya, 1973. "On Economic Inequality," OUP Catalogue, Oxford University Press, number 9780198281931, Decembrie.
    5. Ronan Congar & Vincent Merlin, 2012. "A characterization of the maximin rule in the context of voting," Theory and Decision, Springer, vol. 72(1), pages 131-147, January.
    6. Donaldson, David & Weymark, John A., 1998. "A Quasiordering Is the Intersection of Orderings," Journal of Economic Theory, Elsevier, vol. 78(2), pages 382-387, February.
    7. Moulin, Herve, 1994. "Social choice," Handbook of Game Theory with Economic Applications, in: R.J. Aumann & S. Hart (ed.), Handbook of Game Theory with Economic Applications, edition 1, volume 2, chapter 31, pages 1091-1125, Elsevier.
    8. Hill, Brian, 2009. "Confidence and ambiguity," HEC Research Papers Series 914, HEC Paris.
    9. Sen, Amartya, 1993. "Internal Consistency of Choice," Econometrica, Econometric Society, vol. 61(3), pages 495-521, May.
    10. Young, H. P., 1974. "An axiomatization of Borda's rule," Journal of Economic Theory, Elsevier, vol. 9(1), pages 43-52, September.
    11. Dutta, Bhaskar & Panda, Santosh C. & Pattanaik, Prasanta K., 1986. "Exact choice and fuzzy preferences," Mathematical Social Sciences, Elsevier, vol. 11(1), pages 53-68, February.
    12. Asley Piggins & Maurice Salles, 2007. "Instances of Indeterminacy," Post-Print halshs-00337772, HAL.
    13. Mandler, Michael, 2009. "Indifference and incompleteness distinguished by rational trade," Games and Economic Behavior, Elsevier, vol. 67(1), pages 300-314, September.
    14. Basu, Kaushik, 1984. "Fuzzy revealed preference theory," Journal of Economic Theory, Elsevier, vol. 32(2), pages 212-227, April.
    15. Hill, Brian, 2013. "Confidence and decision," Games and Economic Behavior, Elsevier, vol. 82(C), pages 675-692.
    16. Eliaz, Kfir & Ok, Efe A., 2006. "Indifference or indecisiveness? Choice-theoretic foundations of incomplete preferences," Games and Economic Behavior, Elsevier, vol. 56(1), pages 61-86, July.
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    Cited by:

    1. Brian Hill, 2012. "Confidence in preferences," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 39(2), pages 273-302, July.
    2. Hill, Brian, 2016. "Incomplete preferences and confidence," Journal of Mathematical Economics, Elsevier, vol. 65(C), pages 83-103.
    3. Jesper Armouti-Hansen & Christopher Kops, 2018. "This or that? Sequential rationalization of indecisive choice behavior," Theory and Decision, Springer, vol. 84(4), pages 507-524, June.

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    More about this item

    Keywords

    Incomplete preference; Revealed preference; Confidence in preferences; Deferral of decisions; Importance of decisions; Social choice;
    All these keywords.

    JEL classification:

    • D01 - Microeconomics - - General - - - Microeconomic Behavior: Underlying Principles
    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations

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