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Piecewise additivity for non-expected utility

Listed author(s):
  • Craig Webb

    ()

A model of choice under purely subjective uncertainty, Piecewise Additive Choquet Expected utility, is introduced. PACE utility allows for optimism and pessimism simultaneously, but represents a minimal departure from expected utility. It can be seen as a continuous version of NEO-expected utility (Chateauneuf et al. in J Econ Theory 137:538–567, 2007 ) and, as such, is especially suited for applications with rich state spaces. The main theorem provides a preference foundation for PACE utility in the Savage framework of purely subjective uncertainty with an arbitrary outcome set. Copyright Springer-Verlag Berlin Heidelberg 2015

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File URL: http://hdl.handle.net/10.1007/s00199-015-0871-1
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Article provided by Springer & Society for the Advancement of Economic Theory (SAET) in its journal Economic Theory.

Volume (Year): 60 (2015)
Issue (Month): 2 (October)
Pages: 371-392

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Handle: RePEc:spr:joecth:v:60:y:2015:i:2:p:371-392
DOI: 10.1007/s00199-015-0871-1
Contact details of provider: Web page: http://www.springer.com

Web page: http://saet.uiowa.edu/

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