Expected Qualitative Utility Maximization

Daniel Lehmann*

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

17 Scopus citations

Abstract

A model for decision making that generalizes Expected Utility Maximization is presented. This model, Expected Qualitative Utility Maximization, encompasses the Maximin criterion. It relaxes both the Independence and the Continuity postulates. Its main ingredient is the definition of a qualitative order on nonstandard models of the real numbers and the consideration of nonstandard utilities. Expected Qualitative Utility Maximization is characterized by an original weakening of von Neumann-Morgenstern's postulates. Subjective probabilities may be defined from those weakened postulates, as Anscombe and Aumann (1963, Annals of Mathematical Statistics 34, 199-205) did from the original postulates. Subjective probabilities are numbers, not matrices as in the Subjective Expected Lexicographic Utility approach.

Original languageEnglish
Pages (from-to)54-79
Number of pages26
JournalGames and Economic Behavior
Volume35
Issue number1-2
DOIs
StatePublished - Apr 2001

Keywords

  • Non-standard utilities
  • Qualitative decision theory
  • Utility theory

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