Expected utility with purely subjective non-additive probabilities (Q1095774)
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| Language | Label | Description | Also known as |
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| English | Expected utility with purely subjective non-additive probabilities |
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Expected utility with purely subjective non-additive probabilities (English)
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1987
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Acts are functions from the set of states of the world into the set of consequences. Savage proposed axioms regarding a binary relation on the set of acts which are necessary and sufficient for it to be representable by the functional \(\int u(\cdot)dP\) for some real-valued (utility) function u on the set of consequences and a (probability) measure P on the set of states of the world. The Ellsberg paradox leads us to reject one of Savage's main axioms - the Sure Thing Principle - and develop a more general theory, in which the probability measure need not be additive.
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non-additive probabilities
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Ellsberg paradox
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Sure Thing Principle
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