Related papers: Dual theory of choice with multivariate risks
Nontransitive choices have long been an area of curiosity within economics. However, determining whether nontransitive choices represent an individual's preference is a difficult task since choice data is inherently stochastic. This paper…
This paper formulates and studies a general continuous-time behavioral portfolio selection model under Kahneman and Tversky's (cumulative) prospect theory, featuring S-shaped utility (value) functions and probability distortions. Unlike the…
In this paper, an optimization problem with uncertain constraint coefficients is considered. Possibility theory is used to model the uncertainty. Namely, a joint possibility distribution in constraint coefficient realizations, called…
Stochastic dominance is a crucial tool for the analysis of choice under risk. It is typically analyzed as a property of two gambles that are taken in isolation. We study how additional independent sources of risk (e.g. uninsurable labor…
A researcher observes a finite sequence of choices made by multiple agents in a binary-state environment. Agents maximize expected utilities that depend on their chosen alternative and the unknown underlying state. Agents learn about the…
The principle that rational agents should maximize expected utility or choiceworthiness is intuitively plausible in many ordinary cases of decision-making under uncertainty. But it is less plausible in cases of extreme, low-probability risk…
Employing a generalized definition of Pratt (1964) and Arrow's (1965, 1971) probability premium, we introduce a new concept of attitude towards probability. We illustrate in a problem of risk sharing that whether attitude towards…
Computer modeling of human decision making is of large importance for, e.g., sustainable transport, urban development, and online recommendation systems. In this paper we present a model for predicting the behavior of an individual during a…
We introduce an algorithmic decision process for multialternative choice that combines binary comparisons and Markovian exploration. We show that a preferential property, transitivity, makes it testable.
The mixed multinomial logit model assumes constant preference parameters of a decision-maker throughout different choice situations, which may be considered too strong for certain choice modelling applications. This paper proposes an…
The well-known Condorcet's Jury theorem posits that the majority rule selects the best alternative among two available options with probability one, as the population size increases to infinity. We study this result under an asymmetric…
In economics, risk aversion is modeled via a concave Bernoulli utility within the expected-utility paradigm. We propose a simple test of expected utility and concavity. We find little support for either: only 30 percent of the choices are…
We examine a weighted-network multi-agent model with preferential selection such that agents choose partners with the probability $p(w)$, where $w$ is the number of their past selections. When $p(w)$ increases sublinearly with the number of…
This paper studies Pareto-optimal reinsurance design in a monopolistic market with multiple primary insurers and a single reinsurer, all with heterogeneous risk preferences. The risk preferences are characterized by a family of risk…
In multiple criteria decision aiding, very often the alternatives are compared by means of a value function compatible with the preferences expressed by the Decision Maker. The problem is that, in general, there is a plurality of compatible…
Standard decision theory seeks conditions under which a preference relation can be compressed into a single real-valued function. However, when preferences are incomplete or intransitive, a single function fails to capture the agent's…
It is challenging to quantify numerical preferences for different objectives in a multi-objective decision-making problem. However, the demonstrations of a user are often accessible. We propose an algorithm to infer linear preference…
We apply the power-of-two-choices paradigm to a random walk on a graph: rather than moving to a uniform random neighbour at each step, a controller is allowed to choose from two independent uniform random neighbours. We prove that this…
We study group decision making with changing preferences as a Markov Decision Process. We are motivated by the increasing prevalence of automated decision-making systems when making choices for groups of people over time. Our main…
The question of selecting the "best" amongst different choices is a common problem in statistics. In drug development, our motivating setting, the question becomes, for example: what is the dose that gives me a pre-specified risk of…