Generic utility theory: Measurement foundations and applications in multiattribute utility theory (Q1262839): Difference between revisions

The formulated utility representation is generic in the sense that it is implied by many stronger utility theories. The generic utility representation postulates that the preference order on a subset of two- outcome gamblers with fixed probability is represented by an additive combination of the utility outcomes. An axiomatization of the generic utility representation is presented, along with proofs on the existence and interval scale uniqueness of the representation. The generic utility theory is important because formalizations and experimental tests carried out within its framework will be meaningful from the viewpoint of any stronger theory that implies the generic utility theory. Formalizations of two-factor additive and multiplicative utility models and of parametric utility models are presented within the generic utility framework. The formalizations illustrate how to develop multiattribute and parametric utility models in the generic utility framework. In particular, formalizations show how to develop multiattribute and parametric models within prospect theory and the dual bilinear model.