Local expected utility without compactness
| dc.contributor.author | Bardsley, Peter | |
| dc.date.accessioned | 2022-11-03T09:05:03Z | |
| dc.date.available | 2022-11-03T09:05:03Z | |
| dc.date.issued | 1992-08 | |
| dc.description.abstract | For probability distributions defined over a finite interval, it is well known that the hypothesis of smooth preferences leads to an elegant generalization of expected utility theory. One can show that local utility functions exist, and that their shape and curvature describe attitude to risk just as in the classical von Neumann Morgernstern theory. As well as encompassing the classical theory, convincing explanations are provided for the ailais paradox and other anomalies. Unfortunately, the fineness assumption excludes the normal distributions and most of the important distributions of economics. This paper shows that the fineness assumption can be dispensed with, leading to a theory with a much broader field of application. | en_US |
| dc.identifier.isbn | 0858168626 | |
| dc.identifier.uri | http://econspace.ips.lk/handle/789/942 | |
| dc.language.iso | en | en_US |
| dc.subject | Economic growth, Classical theory, | en_US |
| dc.title | Local expected utility without compactness | en_US |
| dc.type | Working Paper | en_US |