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Table of contents (14 chapters)
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Front Matter
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The Expected Utility Model
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Front Matter
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The Rank-Dependent Model
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Front Matter
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Further Properties of The Model
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Front Matter
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Generalized Expected Utility Theory
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Front Matter
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Back Matter
About this book
Generalized expected utility is now a flourishing subfield of economics, with dozens of competing models and considerable literature exploring their theoretical properties and comparing their empirical performance. But the EU model remains the principal tool for the analysis of choice under uncertainty. There is a view that generalized models are too difficult to handle or incapable of generating sharp results. This creates a need to show that the new models can be used in the kinds of economic analysis for which EU has been used, and that they can yield new and interesting results.
This book meets this need by describing one of the most popular generalized models -- the rank-dependent expected utility model (RDEU), also known as anticipated utility, EU with rank-dependent preferences, the dual theory of choice under uncertainty, and simply as rank-dependent utility. As the many names indicate, the model has been approached in many ways by many scientists and for this reason, consideration of a single model sheds light on many of the concerns that have motivated the development of generalized utility models.
The popularity of the RDEU model rests on its simplicity and tractability. The standard tools of analysis developed for EU theory may be applied to the RDEU model, but since RDEU admits behavior inconsistent with EU, thefield of potential applications is widened. As such, the RDEU model is not as much a competitor to EU as an extension based on less restrictive assumptions.
Authors and Affiliations
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Australian National University, Australia
John Quiggin
Bibliographic Information
Book Title: Generalized Expected Utility Theory
Book Subtitle: The Rank-Dependent Model
Authors: John Quiggin
DOI: https://doi.org/10.1007/978-94-011-2182-8
Publisher: Springer Dordrecht
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eBook Packages: Springer Book Archive
Copyright Information: Kluwer Academic Publishers 1993
Hardcover ISBN: 978-0-7923-9302-3Published: 31 December 1992
Softcover ISBN: 978-94-010-4966-5Published: 27 September 2012
eBook ISBN: 978-94-011-2182-8Published: 06 December 2012
Edition Number: 1
Number of Pages: XII, 208
Topics: Economic Theory/Quantitative Economics/Mathematical Methods, Operations Research/Decision Theory, Statistics for Business, Management, Economics, Finance, Insurance