Utility Theories: Measurements and Applications

✍ Scribed by L. Robin Keller (auth.), Ward Edwards (eds.)

• Publisher: Springer Netherlands
• Year: 1992
• Tongue: English
• Leaves: 304
• Series: Studies in Risk and Uncertainty 3
• Edition: 1
• Category: Library

✦ Synopsis

The Conference on "Utility: Theories, Measurements, and Applications" met at the Inn at Pasatiempo in Santa Cruz, California, from June II to 15, 1989. The all-star cast of attendees are listed as authors in the Table of Contents of this book (see p. V), except for Soo Hong Chew and Amos Tversky. The purpose of the conference, and of National Science Foundation Grant No. SES-8823012 that supported it, was to confront proponents of new generalized theories of utility with leading decision analysts com­ mitted to the implementation, in practice, of the more traditional theory that these new theories reject. That traditional model is variously iden­ tified in this book as expected utility or subjectively expected utility maximization (EU or SEU for short) and variously attributed to von Neumann and Morgenstern or Savage. I had feared that the conference might consist of an acrimonious debate between Olympian normative theorists uninterested in what people actually do and behavioral modelers obsessed with the cognitive illusions and uninterested in helping people to make wise decisions. I was entirely wrong. The conferees, in two dramatic straw votes at the open­ ing session, unanimously endorsed traditional SEU as the appropriate normative model and unanimously agreed that people don't act as that model requires. (These votes had a profound impact on my thinking; detail about them and about that impact is located in Chapter 10.

✦ Table of Contents

Front Matter....Pages i-xv
Front Matter....Pages 1-1
Properties of Utility Theories and Related Empirical Phenomena....Pages 3-23
Front Matter....Pages 25-25
In Praise of the Old Time Religion....Pages 27-55
On the Foundations of Prescriptive Decision Analysis....Pages 57-72
Generic Analysis of Utility Models....Pages 73-106
Front Matter....Pages 107-107
Small Worlds and Sure Things: Consequentialism by the Back Door....Pages 109-136
What Now for Generalized Utility Theory?....Pages 137-163
The Independence Axiom Versus the Reduction Axiom: Must We Have Both?....Pages 165-183
Front Matter....Pages 185-185
Rational Versus Plausible Accounting Equivalences in Preference Judgments....Pages 187-206
Recent Tests of Generalizations of Expected Utility Theory....Pages 207-251
Toward the Demise of Economic Man and Woman; Bottom Lines from Santa Cruz....Pages 253-267
Front Matter....Pages 269-269
Old and New Roles for Expected and Generalized Utility Theories....Pages 271-294
Back Matter....Pages 295-300

✦ Subjects

Economic Theory; Microeconomics; Operation Research/Decision Theory