Social Decision Theory and Non-strategic Behaviour
Using the Expected Utility framework, this paper develops a general model of other-regarding preferences under risk. I assume that in addition to conventional preferences over outcomes, individuals could have preferences over outcomes of their peers. Decision makers with other-regarding preferences may show a concern for risk; that is they may care not just about what the outcomes of others are but also the risks taken by the others. In our representation, we separate a self-regarding component of the decision maker's preferences from another regarding component. The self-regarding component is represented by a \von Neumann-Morgenstern utility function". The other regarding component is an expected social value function which depends on the social interactions between decision maker and the others.
|Date of creation:||Oct 2012|
|Date of revision:|
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- Kockesen, Levent & Ok, Efe A., 1997.
"Negatively Interdependent Preferences,"
97-02, C.V. Starr Center for Applied Economics, New York University.
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"Tit for Tat: Foundations of Preferences for Reciprocity in Strategic Settings,"
UWO Department of Economics Working Papers
9905, University of Western Ontario, Department of Economics.
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- Segal, Uzi & Sobel, Joel, 1999. "Tit for Tat: Foundations of Preferences for Reciprocity in Strategic Settings," University of California at San Diego, Economics Working Paper Series qt9xf8836g, Department of Economics, UC San Diego.
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- Edi Karni & Zvi Safra, 2002. "Individual Sense of Justice: A Utility Representation," Econometrica, Econometric Society, vol. 70(1), pages 263-284, January.
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