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An incentive compatible scoring rule for ordinal judgments of expected utility maximizers

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  • Jaspersen, Johannes G.

Abstract

This note introduces a scoring rule for ordinal likelihood judgments based on the linear scoring rule. If the ordinal judgments are strict, the scoring rule is incentive compatible for expected utility maximizers as long utility is increasing in wealth. When allowing for non-strict judgments, the scoring rule is no longer incentive compatible for all expected utility maximizers, but still incentive compatible for expected value maximizers. In both cases the scoring rule fulfills the Relevance Principle and is thus simple to implement experimentally.

Suggested Citation

  • Jaspersen, Johannes G., 2013. "An incentive compatible scoring rule for ordinal judgments of expected utility maximizers," Economics Letters, Elsevier, vol. 120(2), pages 245-248.
    • Handle: RePEc:eee:ecolet:v:120:y:2013:i:2:p:245-248
    DOI: 10.1016/j.econlet.2013.04.042
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    References listed on IDEAS

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    1. Charness, Gary & Dufwenberg, Martin, 2003. "Promises & Partnership," Research Papers in Economics 2003:3, Stockholm University, Department of Economics.
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    More about this item

    Keywords

    Scoring rules; Expected utility maximization; Ordinal information;
    All these keywords.

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior

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