Related papers: Probability Premium and Attitude Towards Probabili…
In the paper there is studied an optimal saving model in which the interest-rate risk for saving is a fuzzy number. The total utility of consumption is defined by using a concept of possibilistic expected utility. A notion of possibilistic…
We provide a new characterization of second-order stochastic dominance, also known as increasing concave order. The result has an intuitive interpretation that adding a risk with negative expected value in adverse scenarios makes the…
This paper develops a risk-adjusted alternative to standard optimal policy learning (OPL) for observational data by importing Roy's (1952) safety-first principle into the treatment assignment problem. We formalize a welfare functional that…
Goods and services -- public housing, medical appointments, schools -- are often allocated to individuals who rank them similarly but differ in their preference intensities. We characterize optimal allocation rules when individual…
In this paper, we aims to state some proprieties of willingness to pay (WTP) for partial risk reduction and links with insurance within the dual theory of decision. In the case of partial reduction, we get as Langlais (2005) that a…
The assignment problem is one of the most well-studied settings in social choice, matching, and discrete allocation. We consider the problem with the additional feature that agents' preferences involve uncertainty. The setting with…
Three statistical studies, all published between 2004 and 2008 but without referring to one another, assert a useful equivalence involving the hazard ratio, a parameter estimated for time to event data by the frequently used proportional…
We present a semantics for adding uncertainty to conditional logics for default reasoning and belief revision. We are able to treat conditional sentences as statements of conditional probability, and express rules for revision such as "If A…
This study provides a solution of the equity premium puzzle. Questioning the validity of the Arrow-Pratt measure of relative risk aversion for detecting the risk behavior of investors under all conditions, a new tool, that is, the…
In previous work cite{Ha98:Towards} we presented a case-based approach to eliciting and reasoning with preferences. A key issue in this approach is the definition of similarity between user preferences. We introduced the probabilistic…
This contribution derives from a rather extensive study on the foundations of probability. We start by discussing critically the two main models of the random event in Probability Theroy and cast light over a number of incongruities. We…
This expository paper advocates an approach to physics in which ``typicality" is identified with a suitable form of algorithmic randomness. To this end various theorems from mathematics and physics are reviewed. Their original versions…
The notion of probability plays an important role in almost all areas of science and technology. In modern mathematics, however, probability theory means nothing other than measure theory, and the operational characterization of the notion…
We provide and axiomatize a representation for preferences over lotteries that generalizes the expected utility model. Since the representation uses different utility functions to evaluate different lotteries, the preferences can be…
A family of models of individual discrete choice are constructed by means of statistical averaging of choices made by a subject in a reinforcement learning process, where the subject has short, k-term memory span. The choice probabilities…
A likelihood order is defined over linear subspaces of a finite dimensional Hilbert space. It is shown that such an order that satisfies some plausible axioms can be represented by a quantum probability in two cases: pure state and uniform…
We consider a generalization of the classical risk model when the premium intensity depends on the current surplus of an insurance company. All surplus is invested in the risky asset, the price of which follows a geometric Brownian motion.…
One of the major benefits of belonging to a prestigious group is that it affects the way you are viewed by others. Here I use a simple mathematical model to explore the implications of this "prestige bias" when candidates undergo repeated…
The rapid growth of e-commerce has made people accustomed to shopping online. Before making purchases on e-commerce websites, most consumers tend to rely on rating scores and review information to make purchase decisions. With this…
We explore the influence of framing on decision-making, where some products are framed (e.g., displayed, recommended, endorsed, or labeled). We introduce a novel choice function that captures observed variations in framed alternatives.…