Recently Kajii and Ui [17] proposed to characterize interim efficient allocations in an exchange economy under asymmetric information when uncertainty is represented by multiple posteriors. When agents have Bewley’s incomplete preferences, Kajii and Ui [17] proposed a necessary and sufficient condition on the set of posteriors. However, when agents have Gilboa–Schmeidler’s MaxMin expected utili...

We develop a behavioral axiomatic characterization of exponentially discounted utility (EDU) over consumption streams. Given is an individual agent’s behavior in the market: assume a finite collection of purchases across periods. We show that such behavior satisfies a “revealed preference axiom” if and only if there exists a EDU model (a discount rate per period and a concave utility function o...

this paper studies housing choice under fuzzy circumstances. in this article, fuzzy distance method is employed for selection process. methodology of housing choice with fuzzy distance approach is based on the minimizing fuzzy distance of features from desired amount under fuzzy condition. meanwhile, in the discrete choice models, housing choice is based on utility maximizing of available optio...

I apply a prospect theory model of risk preferences with an endogenously determined reference point to propose an alternative objective of maximizing expected outcome rather than maximizing expected utility. I show that an agent can always form a consistent expected outcome for any binary gamble and derive a parametric formula, which can then be used to examine the effects of loss aversion, ris...

We use a simple version of the Psychological Expected Utility Model (Caplin and Leahy, QJE, 2001) to analyze the optimal choice of information accuracy by an individual who is concerned with anticipatory feeling. The individual faces the following trade-off: on the one hand information may lead to emotional costs, on the other the higher the information accuracy, the higher the efficiency of de...

This paper contributes towards the development of an empirical approach applicable to contingent valuation to accommodate non-expected utility risk preferences. Combining elicitation approaches used in field experiments with contingent valuation, we embed an experimental design that systematically varies probabilities and losses across a survey sample in a willingness to pay elicitation format....

A new non-parametric method to estimate a decision maker's coefficient of absolute risk aversion from observed economic behaviour is explained. The method uses the expected value-variance (E-V) framework and quadratic programming. An empirical illustration is given using Norwegian farm-level data. © 2002 Elsevier Science B.V. All rights reserved. JEL classification: Q12; D81

JEL classification: C65, D63, D71, D81 Mathematics Subject Classification (2000): 91B16

Expected utility functions are limited to second-order (conditional) risk aversion, while non-expected utility functions can exhibit either …rst-order or second-order (conditional) risk aversion. We extend the concept of orders of conditional risk aversion to orders of conditional dependent risk aversion. We show that …rst-order conditional dependent risk aversion is consistent with the framewo...

Within the prospect theory the paper examines production and hedging decisions of a competitive firm under price uncertainty. We consider the prospect theory for the firm's utility function in the two moment model known as (mu,sigma)-preference. In contrast to the literature our findings show that the production under uncertainty can be larger than in the certainty case. Furthermore, we demonst...