Discover the concept of utility in microeconomics, exploring its origins, types, and applications to analyze consumer ...

This paper begins by observing that any reflexive binary (preference) relation (over risky prospects) that satisfies the independence axiom admits a form of expected utility representation. We refer ...

Decision theory is a cornerstone of economic analysis, providing a framework for understanding how individuals and institutions make choices under conditions of uncertainty and risk. At its core, the ...

This is a preview. Log in through your library . Abstract We extend the analysis of risk aversion with state-dependent preferences to the rank-dependent expected utility theory. We find that in this ...

A utility function measures a consumer’s preference and satisfaction with different goods or services. As part of rational choice theory, it helps economists analyze how consumers make decisions to ...