Expected utility paradoxes

The expected utility (EU) model is widely used for predicting and describing choices under uncertainty. Its usefulness, however, is limited because of its widely acknowledged inconsistencies and paradoxes. This paper describes how important EU model paradoxes can be resolved by accounting for the in...

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Veröffentlicht in:	The Journal of socio-economics 2010-04, Vol.39 (2), p.187-193
Hauptverfasser:	Robison, Lindon J., Shupp, Robert S., Myers, Robert J.
Format:	Artikel
Sprache:	eng
Schlagworte:	Allais paradox Attachment values Cash segregation paradox Certainty Choices Coalescing paradox Economic models Ellsberg paradox European Union Expected utility Expected utility Social expected utility Word frames Socio-emotional goods Attachment values Allais paradox Insurance paradox Ellsberg paradox Coalescing paradox Violations of stochastic dominance Cash segregation paradox Risk preferences for losses paradox Insurance paradox Risk preferences for losses paradox Social expected utility Social psychology Socio-emotional goods Studies Violations of stochastic dominance Word frames
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Beschreibung
Zusammenfassung:	The expected utility (EU) model is widely used for predicting and describing choices under uncertainty. Its usefulness, however, is limited because of its widely acknowledged inconsistencies and paradoxes. This paper describes how important EU model paradoxes can be resolved by accounting for the influences of socio-emotional goods (SEGs) embedded in word and other symbolic frames.
ISSN:	1053-5357 2214-8043 1879-1239 2214-8051
DOI:	10.1016/j.socec.2009.12.005