Von Neuman- Morgenstern utilities and cardinal preferences
AbstractWe study the aggregation of preferences when intensities are taken into account: the aggregation of cardinal preferences, and also of von Neumann-Morgenstern utilities for choices under uncertainty. We show that with a finite number of choices there exist no continuous anonymous aggregation rules that respect unanimity, for such preferences or utilities. With infinitely many (discrete sets of) choices, such rules for exist and they are constructed here. However, their existence is not robust: each is a limit of rules that do not respect unanimity. Both results are for a finite number of individuals. The results are obtained by studying the global topological structure of spaces of cardinal preferences and of von Neumann-Morgenstern utilities. With a finite number of choices, these spaces are proven to be noncontractible. With infinitely many choices, on the other hand, they are proven to be contractible.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 8090.
Date of creation: 1985
Date of revision:
preferences; cardinal preferences; aggregation; von Neumann; Morgenstern; Morgenstern utilities; unanimity; utilities;
Find related papers by JEL classification:
- C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation
- C02 - Mathematical and Quantitative Methods - - General - - - Mathematical Economics
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