A revealed-preference implication of weighted utility decisions under uncertainty
In a novel formulation of revealed preference analysis, Green and Osband  show that for expected-utility maximizers, acts partition the state-simplex into linear polyhedral blocks. The question naturally arises whether this characterization distinguishes expected utility theory from non-expected utility theories. This paper investigates the weighted utility theory of Chew  and shows that the corresponding partition is systematically different from the expected utility theory: the boundaries of the partition blocks are quadratic rather than linear. This result contains useful empirical contents.
Volume (Year): 11 (1998)
Issue (Month): 2 ()
|Note:||Received: May 15, 1995; revised version: November 22, 1996|
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